Why that corporate cash pile isn't so impressive
NEW YORK (AP) — Hardly a day goes by without a politician or pundit pointing out that companies are hoarding cash — roughly $3 trillion — and that they could help the economy if only they'd spend it.
But companies have piled up even more debt lately than they have cash. Financial experts say it makes companies more vulnerable than they look.
Former U.S. budget director David Stockman says, "The record cash story is bull market baloney."
The debt owed by companies amounts to 83 percent of the goods and services they produce. That's lower than during the recession. But before that, you have to go back at least six decades to find such a heavy debt load.