Giants hoard cash, small companies "starve": study

[Hot Mega]

It's just one story but it does anecdotally bear out the belief that increased business revenue or even tax cuts don't necessarily return to the economy in the form of jobs.

Just more evidence of the skittishness adding to the challenge of restoring the economy.

NEW YORK (Reuters) - The 1,000 largest U.S. corporations outside the finance sector have used low borrowing costs to build up an $853 billion cushion of cash, but they are hoarding the money rather than spending it, according to a new study.

This still-growing cash pile reflects uncertainty over the economy, skepticism about demand and a lack of attractive investment opportunities, according to the study to be published on Friday by REL Consulting, a division of the Hackett Group , and CFO Magazine.

Cash levels at the end of last year were up 6 percent from 2009 and up 75 percent from before the recession, the annual study found.

The research suggests that a long period of low interest rates and other measures to stimulate a still-feeble U.S. economy have let companies fill their coffers for better days ahead without putting the money to work. It predicts companies will further increase reserves for the balance of this year.

It also draws a sharp contrast with small companies, which are less likely to have top-notch credit ratings.

Hoarding at link....

http://news.yahoo.com/giants-hoard-cash-small-companies-starve-study-173853319.html

 

[Facetious]

Giants will always hoard cash... who's going to stop them?

Really, if politicians are routinely, if not regularly bought and sold, what do we do, seek out a communalist form of government to remedy these injustices?
Nope, we'd just end up with fewer, more powerful GIANTS and an authoritarian - autocratic government, IMNSHO.

In the grand scheme of things, I think that we need better, more well intentioned philanthropists in this world.... philanthropists who aren't naked hypocrites, i.e. dirty, filthy rich bastids who fund anything and everything that opposes the very capitalism that made them wealthy in the first place.... dammit! :cussing:

 

[Kingfisher]

They're just now writing about this. I saw this happening a long time ago. Accountants taking forever to fulfill, so they pull more interest, making their bottom line look better, f'ing over other companies in the process. 30 day nets, bumping slowly out, some to 45, one damn company I have to deal with is at 75 fucking days! 75!! And if you lower the amount on the invoice, they lower it to 60... They have the money, the guy running the accounting is a raging asshole.