Kathleen Kahle, a professor at the University of Georgia's business school, offers another reason: the growth of high-tech companies, which tend to hold lots of cash. Younger, riskier firms have more difficulty raising money when credit is tight, so they keep more cash on hand, she says. "At the same time, they have a lot of growth opportunities and want to make sure that they have the funds necessary to invest in good projects," she adds.
Wall Street pundits talk about it all the time: corporations are sitting on record levels of cash. According to Moody's, non-financial corporations are sitting on around $1.5 trillion worth of cash. Bulls argue that this means companies could unleash this cash in the forms of capital expenditures, mergers and acquisitions, dividends, and share buybacks.
NEW DELHI: India has "better investment climate" than other BRIC nations even as regulatory and tax system-related challenges are impacting immediate investment plans, says a survey of top executives of German companies. More than 90 CEOs and CFOs from leading German high-tech companies participated in the survey done by global consultancy EY and research firm Delphi. Investors recognize India's market growth, large market size and efforts to attract FDI while the perceived obstacles, are its infrastructure, administration and regulation, the study said.
NEW DELHI: Giving thumbs up to PM Narendra Modi-led NDA government, Moody's on Thursday revised India's outlook to 'positive' from 'stable', while maintaining the credit rating at Baa3. According to Moody's the policymakers are establishing a framework that will allow the country's growth to continue to outperform that of its peers over the medium-term and improve India's macro-economic, infrastructure and institutional profile.
Alibaba Group Holding Ltd (NYSE:BABA) reported the results of its Indian operations today. The Chinese e-commerce giant recorded net profits in the region, despite falling gross profits due to selling a lesser number of units.
In times of turmoil, the chief financial officers of the corporate sphere tighten their hold on the corporate purse. The first line item to get squeezed is usually advertising and marketing. Then hiring. Then spending on information technology. When things start looking up again, they usually loosen that hold, and the money starts flowing once more. At least that’s what usually happens. But when one crisis follows another as has happened of late—first the financial crisis, then the European debt crisis, then the U.S. fiscal cliff—the CFOs of the world can turn perpetually stingy.
Rolf Norfolk submits: On Friday, Charles Hugh Smith posted a theory that I can accept as at least plausible: America's rich will consolidate their long-term gains by engineering a bond crisis - a refusal by the Federal Reserve to keep financing government spending.