how is it that in times of crisis major businesses will go bankrupt within months? Do they have no savings or what?
In: Economics
Some companies do. Apple is notorious for the amount of cash it keeps on hand – around $100 Billion. Alphabet (owner of Google) does too.
But a lot of investors don’t like this. If a company is hoarding cash, investors think it should invest it in growth, or pay out dividends, or repurchase stock. Add to this short sighted management who think the good times will last forever (I’m looking at you, US airlines) and they don’t need cash.
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