(NYSE: WFC) The (NYSE: BAC) American (NYSE: JPM) (NYSE:C) (NYSE: USB) Banking Week (NYSE: PNC) (NYSE:BBT)

New York- What a week it was for the majority of the ten largest banks in America. It was a week of profit, it was a week of more profit; it was the tale of Wall Street irrationality. It all started on Monday when Citigroup, the nations third largest lender posted $2.1 billion of profit and topped estimates. Everything was going great; the sun was shining; things were looking up and banking stocks roared. Then on Tuesday, Bank of America the nations largest bank came up to bat, BAC said they had earned earned $3.1 billion and everyone jumped for joy. But wait just a minute said investors, why does their income statement show a 7.3 billion dollar loss? What is happening with the foreclosure scandal? Why is my tea cold? It must be Bank of America's fault and this quiet optimism soon faded into the night like a distant dream. Wells Fargo and the other banks plummeted as BAC said sorry guys.

San Francisco's own Wells Fargo was up next, they said thanks BAC but we'll take it from here and "we'll go far," as they announced a record $3.34 billion of profit. Investors remained tepid at first, as they were ready to crush the bank stocks for a second straight day. Wells Fargo sunk 2% in the pre-market, but then they said what the heck this is a great stock, lets buy it and the stock roared 5%. Then it was U.S. Bancorp's turn, the nations 5th largest lender reported a profit of $871 million but investors did not know what to do, and kept the stock flat on the day. Today they decided it was actually a great report and the stock rose 2.3%.

PNC, Sun Trust and BB&T reported today. PNC soared as the company recorded a near record profit. Investors were relieved when Sun Trust Banks reported their first profit in over a year and BB&T shares sunk when they announced $210 million of profit.

And that was the banking week in America, completely illogical, irrational, but very enjoyable to watch from the outside.

Banking (NYSE:BAC) on (NYSE:WFC) America's (NYSE: C) (NYSE:JPM) (NYSE:PNC) (NYSE:USB) (NYSE:BBT) Weak Stomach

Stocks of the largest financial institutions at midday. Wells Fargo is down 3%, JPM 3%, BAC 4.7%, C 2% PNC 1% USB is up .7% and BBT is down 0.83%. The banks are being sold off on "Robogate" which is a foreclosure scandal that could hit many of the nations lenders.

The scandal involves foreclosures on houses by the banks without the necessary documentation and the foreclosure of houses using robo-signers which is when workers involved in forclosures indicate the documentation is present when it is not. This has caused an investigation into whether the banks have violated the law in certain states.

J.P. Morgan is currently reviewing about 115,000 mortgages that are in the foreclosure process and is expanding the temporary moratorium to 41 states.

To give investors a hint on why the current declines in the banking stocks are absurd. Is that the current number of J.P Morgan houses under review where to triple to 345,000 and we use an average home value of 300,000 and we write off all J.P. Morgan's loans on these homes to zero you get a charge of 10 billion. Not only will JPM likely not have to write off any of these loans, it is also likely they will face a very small legal charges.

J.P. Morgan's market cap has already declined by more than our most absurd scenario. This usually gives a hint into that the big fund managers and the people selling the stock have no idea what they are doing.