Skip to content

Here comes a boom! $7 trillion in untapped funds to flood global market

By Catholic Online (NEWS CONSORTIUM)
8/18/2014 (3 years ago)
Catholic Online (www.catholic.org)

Investors clamor for capital investment with end of recession

A new boost to the global economic recovery may happen soon, as corporate giants and private equity firms prepare to tap into cash reserves of $7 trillion, stored since the current financial crisis began back in 2008.

A report suggests that corporations and equity firms hold nearly $7 trillion in cash reserves that could bolster the world's economy.

A report suggests that corporations and equity firms hold nearly $7 trillion in cash reserves that could bolster the world's economy.

Highlights

By Catholic Online (NEWS CONSORTIUM)
Catholic Online (www.catholic.org)
8/18/2014 (3 years ago)

Published in Business & Economics

Keywords: Economy, Business, Finance, International


LOS ANGELES, CA (Catholic Online) - Investors are growing frustrated by more than half a decade of prudence, demanding that chief executives begin to dip into stored reserves.

All over the world there is darkness, please help with "prayer and action."

"Capital spending could increase as early indicators show that industrial companies are beginning to run at higher levels of capacity than has been the case over the last five years," said Dennis Jose, a senior global and European equity strategist at Barclays. "When factories and the like are running at less capacity on the back of lower demand there is very low capital expenditure."

A report suggests that corporations and equity firms hold nearly $7 trillion in cash reserves that c

A report suggests that corporations and equity firms hold nearly $7 trillion in cash reserves that could bolster the world's economy.


After the world financial crisis began, companies hunkered down, re-engineering their balance sheets and diverting funds from investments to pay off debt or stockpile cash. But with the recession ended and the world's economy picking up, many of these companies continue to hoard cash.

Both private investors and governments are calling for the spending of these paper reserves held by 5,1000 of the world's biggest companies, which hold a combined reserve-cash and short-term debt-of $5.7 trillion as of the end of 2013, Thomson Reuters Datastream reports. This excludes financial companies, like banks and insurers, who are required by regulators to hire capital.

American corporations-led by tech giants like Apple, Microsoft and Google-dominate the pack with $2 trillion held.

"If a company has cash on its balance sheet, it has three options; mergers and acquisitions, invest in its business to pursue organic growth, or return it to shareholders," said Laurence Hollingworth, head of corporate coverage EMEA at JPMorgan.

A record number of investors are calling for companies to invest in more capital spending, while record low numbers of investors want the surplus returned to them via dividends and buybacks.

"Investors in private equity firms, which include pension and sovereign wealth funds, now have a greater risk appetite and are looking for returns in an environment with relatively low interest rates", said Richard Parsons, the head of private equity coverage at Deloitte. "They see the private equity market as being able to provide this."

---


'Help give every student and teacher Free resources for a world-class moral Catholic education'


Copyright 2017 - Distributed by THE CALIFORNIA NETWORK

Pope Francis Prayer Intentions for SEPTEMBER 2017
Parishes.
That our parishes, animated by a missionary spirit, may be places where faith is communicated and charity is seen.


Comments


More Business & Economics

Is now the time to sell? Experts say Wall Street is on a bubble, here's why Watch

Image of Stocks appear to be on a bubble according to many experts.

Is now the time to sell on Wall Street? Stocks are on a bubble, according to multiple analysis and expert opinions. Fundamental market ... continue reading


Forget Winter, Recession is Coming Watch

Image of Major indicators reveal recession is coming.

The economy is about to go into recession according to several Wall Street firms. They are warning investors to prepare for an end to the ... continue reading


Get ready for self checkout everywhere: 3.5 million retail cashiers are about to be replaced by automation Watch

Image of Retail cashiers often loathe self checkout stands. However, both cashiers and self checkout stands are facing replacement as new technologies threaten to eliminate the checkout process.

Automation is coming soon to a store near you as retailers look for ways to cut costs and improve profits. The best way to accomplish this ... continue reading


'Budgets are moral documents'

Image of

The highly relevant quote, "Budgets are moral documents," has been arguably attributed to Rev. Martin Luther King, Jr. But if he didn't ... continue reading


Central bankers warn of looming global recession Watch

Image of A recession could be lurking around the corner and central banks have been asked to take note, especially in Asia.

A group of central bankers has warned that a great recession, possibly larger than the 2007-2008 recession is looming on a global scale. ... continue reading


Never Miss any Updates!

Stay up to date with the latest news, information, and special offers.

Catholic Online Logo

Copyright 2017 Catholic Online. All materials contained on this site, whether written, audible or visual are the exclusive property of Catholic Online and are protected under U.S. and International copyright laws, © Copyright 2017 Catholic Online. Any unauthorized use, without prior written consent of Catholic Online is strictly forbidden and prohibited.