Metonymy is a figure of speech wherein a thing or concept is not called by its actual given name, but by the name of an associated thing or concept. Or, to phrase it another way, one element of a larger concept becomes the symbol for the whole concept.
Wall Street, for example, is both a literal place (a street in New York City where significant elements of the U.S. financial market are located like the New York Stock Exchange) and a term that is used to represent the U.S. financial market. When a newscaster says “Wall Street was shaken up today.”, they’re using metonymy since they aren’t referring to the literal street, but the entire financial sector.
Other well-known examples of the phenomenon include Hollywood (it’s literally a district of Los Angeles, but the word serves as a catch-all for the entire U.S. movie industry), Washington (literally Washington, D.C., but used as a stand-in for the U.S. government), and Scotland Yard (the old London Metropolitan Police Force headquarters was located on the street Great Scotland Yard and now the street name stands in for the actual agency name).
Metonymy isn’t limited to places either. We call porcelain/ceramic dishes “china” because of the historical association between the product and China, refer to mercenaries as “hired guns” (in reference to their tools), refer to military officers as “brass” (in reference to the metal alloy traditionally used for military buttons and insignia), and so on. Once you start looking for it, metonymy is all around us.