Jun 1, 2011 12:00 PM

Companies are under intense pressure to start putting their hoards of money to work, which should fuel a surge of buybacks and increased dividend payouts

By Brian F. Lomax & Gregory D. Singer

Corporations around the world responded aggressively to the global recession and financial crisis, clamping down on spending and hoarding massive piles of cash. In the United States, where cost-cutting was especially dramatic, nonfinancial firms hold close to $2 trillion in cash, equal to a record 7 percent of total assets. (See “Time to Let Go?” this page.) Meanwhile, debt burdens are smaller than they've been in decades, both in the United States and globally.

Many businesses may keep bigger cash balances for a while, as the economic recovery remains fragile. But with most of these assets parked in short-term investments earning meager returns, the pressure on management teams to put cash to work is intensifying. If companies don't start unlocking this cash value, conditions are ripe for outsiders — notably activist shareholders or acquirers — to do it for them.

Topics of Interest

Estate Tax	Donor Advised Funds
GSTs	Family Offices
Private Foundations	Life Insurance
2010 Tax Act News	Industry Trends Surveys

E-Newsletter Signup

Poll

Topics of Interest

Estate Tax	Donor Advised Funds
GSTs	Family Offices
Private Foundations	Life Insurance
2010 Tax Act News	Industry Trends Surveys

E-Newsletter Signup

2011 Trust Glossary

Click here to download the 2011 Trust Glossary

50 Years Ago This Month

Click here to read the issue.

50 years ago, in May 1962, we featured articles such as: "Future of Canadian Trusteeship" by Arthur H. Mingay", "Training Trust Employees" by Ian M. Marr, "What is a Trust Officer?" by Eric J. Brown, and "Selling Services" by Donald I. Webb.

Conrad Teitell's Guide to Tax Benefits For Charitable Gifts

Click here to view the most up to date guide (September 2011)

Press Releases