Too-Big-To-Fail
Too-big-to-fail (TBTF) is a term used to describe a financial institution that is so large and interconnected that its failure would be catastrophic to the economy. The term is used to describe banks, insurance companies, and other financial institutions that are so large and interconnected that their failure would cause a domino effect of economic losses throughout the entire economy. The term was first used in the late 1980s to describe the large banks that were deemed too important to the economy to be allowed to fail.
History of Too-Big-To-Fail
The term too-big-to-fail was first used in the late 1980s to describe the large banks that were deemed too important to the economy to be allowed to fail. The term was used to describe the large banks that were deemed too important to the economy to be allowed to fail. The term was used to describe the large banks that were deemed too important to the economy to be allowed to fail. The term was used to describe the large banks that were deemed too important to the economy to be allowed to fail. The term was used to describe the large banks that were deemed too important to the economy to be allowed to fail.
The term gained prominence during the 2008 financial crisis when the US government bailed out several large banks that were deemed too important to the economy to be allowed to fail. The government’s actions were seen as a way to prevent a domino effect of economic losses throughout the entire economy. Since then, the term has been used to describe any financial institution that is deemed too important to the economy to be allowed to fail.
Table of Comparisons
| Financial Institution | Size | Interconnectedness |
|---|---|---|
| Bank A | Large | High |
| Bank B | Medium | Low |
| Bank C | Small | Low |
Summary
Too-big-to-fail is a term used to describe a financial institution that is so large and interconnected that its failure would be catastrophic to the economy. The term was first used in the late 1980s to describe the large banks that were deemed too important to the economy to be allowed to fail. The term gained prominence during the 2008 financial crisis when the US government bailed out several large banks that were deemed too important to the economy to be allowed to fail. For more information about this term, you can visit the websites of the Federal Reserve, the US Treasury, and the International Monetary Fund.
See Also
- Systemically Important Financial Institution (SIFI)
- Financial Stability Oversight Council (FSOC)
- Financial Crisis of 2008
- Bailout
- Too-Interconnected-To-Fail (TITF)
- Too-Important-To-Fail (TITF)
- Too-Systemically-Important-To-Fail (TSITF)
- Financial Stability Board (FSB)
- Financial Stability Oversight Council (FSOC)
- Financial Stability Institute (FSI)
