Bailout
When a government, central bank or group of lenders pumps money into a failing company, bank or country…
In plain English
When a government, central bank or group of lenders pumps money into a failing company, bank or country to keep it alive.
A bailout is a rescue line thrown from outside. Governments bailed out banks in 2008; the IMF and EU bailed out Greece, Ireland and Portugal during the eurozone crisis.
Markets often rally on bailout news because a disorderly collapse is avoided. Critics warn of moral hazard: if lenders expect to be rescued, they take bigger risks next time. Compare a bail-in.
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