Bank of America Could Lose $44 Billion in a Severe Recession. Should Investors Be Worried?

The Federal Reserve recently released the results of its annual stress testing, in which it puts the largest banks in the country through a set of hypothetical severe economic conditions akin to a severe recession. This year, the Fed was not messing around. Between the fourth quarter of 2021 and through the first quarter of 2024, the Fed's hypothetical scenario included unemployment rising above 10%, commercial real estate prices dropping 40%, and stock prices dropping 55%.