Question of the Day: Where Did Those Bank Profits Come From?

A reader in the financial industry writes:

If the current rally in financials is predicated on how great an environment this is for banking operations - borrowing money for free and lending at prevailing rates - why is it that JP Morgan's Net Interest Margins are the same as last year? It looks like the entire beat was generated by bond trading - which means usurious bid/ask spreads, most likely.

Even the bankers are warning that these profits are unsustainable . . . yet the markets are still loving 'em.