The U.S. stock market is becoming ‘too big to fail’
About 55% of Americans own stocks, and equities now make up the largest share of household net worth, surpassing real estate.
Importantly, while the middle class still relies on the value of their homes as the basis of their nest eggs, the wealthiest Americans’ portfolios are heavily dominated by stocks and stakes in private businesses.
There was a time when economists treated a stock-market crash as a healthy, cleansing event for the broader economy. But these days, many on Wall Street and in Washington increasingly wonder if another bear market might pose too great a risk to economic security.
Bloomberg Intelligence’s Eric Balchunas says the government may be increasingly unwilling to tolerate a prolonged bear market.
“K-shaped economy.”
Fed has maintained a longstanding focus on protecting the banking system. This is what motivated the central bank to step in after the collapse of Silicon Valley Bank in March 2023.
Joseph Adinolfi MarketWatch 11 July 2026
https://www.marketwatch.com/story/the-u-s-stock-market-is-becoming-too-big-to-fail-b3473e40
“Too big to fail” was a phrase popularized during the 2008 financial crisis to refer to the deeply interconnected U.S. banking giants that had become too systemically important to be allowed to go out of business.
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