U%20S%20Firms%20Build%20Up%20Record%20Piles%20of%20Cash

U%20S%20Firms%20Build%20Up%20Record%20Piles%20of%20Cash -...

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Wall Street Journal U.S. NEWS JUNE 10, 2010 U.S. Firms Build Up Record Cash Piles by JUSTIN LAHART U.S. companies are holding more cash in the bank than at any point on record, underscoring persistent worries about financial markets and about the sustainability of the economic recovery. The Federal Reserve reported Thursday that nonfinancial companies had socked away $1.84 trillion in cash and other liquid assets as of the end of March, up 26% from a year earlier and the largest-ever increase in records going back to 1952. Cash made up about 7% of all company assets, including factories and financial investments, the highest level since 1963. While renewed confidence in corporate-bond markets has allowed big companies to raise a record amount of money, many are still hesitant to spend the cash on hiring or expansion amid doubts about the strength of the recovery. They are also anxious to keep cash on hand in case Europe's debt troubles lead to a new market freeze. "Cash is still king," said Jeff Hand, chief operating officer at Ross Controls, a Troy, Mich., maker of pneumatic valves and other products that is holding more cash as it struggles to recover from a sharp drop in business last year. "We're coming out of that, but the uncertainty is still there." The rising corporate cash balances could represent a longer-term behavioral shift in the wake of the deepest financial crisis
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U%20S%20Firms%20Build%20Up%20Record%20Piles%20of%20Cash -...

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