too big to fail

Syllable breakdown

Dictionary meaning

a phrase describing financial institutions or corporations so large, interconnected, and systemically important that their failure would cause catastrophic damage to the wider economy, effectively forcing governments to bail them out to prevent systemic collapse; the concept gained public prominence during the 2008 global financial crisis when the US government intervened to rescue large banks such as Citigroup and AIG; critics argue that the implicit government guarantee encourages excessive risk-taking by large institutions, since management knows losses will ultimately be socialised