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Why Companies Are Blowing Their Cash Reserves
Companies have been blowing their cash reserves. At first glance, it’s easy to assume that this is just because companies are trying to protect against high inflation but there’s actually a much more deeprooted reason. In fact, many of the top companies have been reducing their cash reserves well before inflation took hold. It turns out that holding too much cash is an ominous sign for companies. Studies have shown that there is an inverse correlation between cash reserves and stock performance. This makes sense as companies with large cash reserves have simply run out of places to put their money, so they have turned to hoarding cash, buying bonds, and buying back stock. This was historically the main reason that companies tended to avoid large cash reserves but recently, there has been yet another reason. You see, the best currency to hold is no longer cash or gold or oil or equity. The best currency to hold is actually the attention of people. This is the primary currency that every big tech company is fighting for and they’re more than happy to convert their cash reserves to buyout attention. This video explains why companies are blowing their cash reserves and where they’re putting their cash instead.
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By Logically AnsweredWhy Companies Are Blowing Their Cash Reserves
Companies have been blowing their cash reserves. At first glance, it’s easy to assume that this is just because companies are trying to protect against high inflation but there’s actually a much more deeprooted reason. In fact, many of the top companies have been reducing their cash reserves well before inflation took hold. It turns out that holding too much cash is an ominous sign for companies. Studies have shown that there is an inverse correlation between cash reserves and stock performance. This makes sense as companies with large cash reserves have simply run out of places to put their money, so they have turned to hoarding cash, buying bonds, and buying back stock. This was historically the main reason that companies tended to avoid large cash reserves but recently, there has been yet another reason. You see, the best currency to hold is no longer cash or gold or oil or equity. The best currency to hold is actually the attention of people. This is the primary currency that every big tech company is fighting for and they’re more than happy to convert their cash reserves to buyout attention. This video explains why companies are blowing their cash reserves and where they’re putting their cash instead.
Earn Interest From The Government & Top Corporations:
Free Weekly Newsletter With Insiders:
Socials:
Discord Community:
Timestamps:
Resources:
Disclaimer:
------------
Learn more about your ad choices. Visit megaphone.fm/adchoices