Bailing out

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Bailing out

In the context of securities, refers to selling a security or commodity quickly, regardless of the price. May occur when an investor no longer wants to sustain further losses on a stock.

Also refers to relieving an individual, corporation, or government entity in financial trouble.

Bail Out

To give money to a company so that it avoids bankruptcy and is able to continue operations. Generally speaking, the term often refers to a government bailing out a private corporation. A bailout may take the form of a direct transfer of capital, or it may occur indirectly through low or no interest loans and subsidies. For example, in September of 2008 the insurance conglomerate AIG found itself in dire straits. The Federal Reserve bailed it out by extending $85 billion (and eventually $182 billion) in credit to the company. Proponents of bailouts say that they keep an economy afloat when an industry thought too big to fail otherwise would collapse. Critics contend that bailouts are inefficient and that non-competitive companies ought to fail. See also: Cash for clunkers.
References in periodicals archive ?
pounds 850bn The price tag for bailing out British banks during the 2008 crunch - although the true cost to taxpayers will not be known for years
He has posted online a video of himself lambasting the notion of bailing out bankrupt banks.
Sovereign wealth funds (SWFs) are "particularly cautious" about bailing out distressed companies and are also diverting funds "to add stability and economic stimulus to local markets", according to a survey by Financial Dynamics International (FD).