StockTwits
07-19-2010, 01:40 PM
Greenberg: More Cash Equals More Risk for Yield-Hungry Companies - CNBC (http://abnormalreturns.com/links/172600/visit) (www.cnbc.com)
by herbgreenberg 38 minutes ago
Beyond the earnings headlines, you might want to keep an eye on corporate balance sheets, especially as their cash balloons. With so much cash, companies have two choices beyond acquisitions, dividends and buybacks: They can invest it the old-fashioned way by putting it into Treasurys and money markets and getting a yield that might as well be zero. They can start reaching for yield by taking more risk. It would appear they're doing more of the latter than the former.
see story at Abnormal Returns site...(RSS feed) (http://abnormalreturns.com/links/index?date=07/19/2010#172600)
by herbgreenberg 38 minutes ago
Beyond the earnings headlines, you might want to keep an eye on corporate balance sheets, especially as their cash balloons. With so much cash, companies have two choices beyond acquisitions, dividends and buybacks: They can invest it the old-fashioned way by putting it into Treasurys and money markets and getting a yield that might as well be zero. They can start reaching for yield by taking more risk. It would appear they're doing more of the latter than the former.
see story at Abnormal Returns site...(RSS feed) (http://abnormalreturns.com/links/index?date=07/19/2010#172600)