WSJ: COVID-19 Makes Fed’s Banking Stress Tests Look Easy

The Wall Street Journal reported that as the largest U.S. banks prepare for their annual stress tests, many are realizing that the impact of COVID-19 is far worse.

The Journal noted that annual tests were designed to determine if the nation’s largest banks would survive the worst economic conditions the Fed could imagine: a recession, declines in the stock market and oil prices, and upticks in loan defaults and unemployment.

Many are anticipating that the fallout of COVID-19 will be far worse than the nightmare scenario envisioned on the Fed’s stress test, according to the Journal.

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