Why should Tim Cook bring his cash home?

nigelmarkdiasnigelmarkdias Posts: 1,323 Silver ✭✭✭✭

US companies are 'hoarding' a record $2.5 trillion in cash overseas

Although Apple now has $91.5bn of earnings permanently reinvested overseas, it is not the biggest holder — General Electric and Microsoft have more than $100 billion each.
Bob Bryan, Business Insider


  • GoldmattersGoldmatters Posts: 3,902 Admin
    @nigelmarkdias Now what I would like to see is Apple keeping that cash in a Goldmoney wealth account. Anyone else?
  • GrandpaBrianGrandpaBrian Posts: 679 Silver ✭✭✭✭
    Another example of "unintended consequences". When the US set its tax rates for corporations they certainly never intended that all the money would end up outside of America. But as we see, money really has no nationality or loyalty. Money is global. These aren't called "multi-national corporations" for no reason.

    Gold is the natural global currency. On the theme of "unintended consequences" I can't help but feel the world is about to experience more of them as a result of the US elections.
  • RocketDogRocketDog Posts: 685 Silver ✭✭✭✭
    I think that the language used in this article and many others like it is very "telling" as to why these firms keep their money out of the USA. Maintaining corporate reserves is called "hoarding". And the idea that the funds be back home is anticipated by drooling economists, speculating on where that money would be "invested" (spent) to boost the economy. Back before the corporate raider days of the 1980's it was IBMs policy to maintain 5 years of cash reserves in the event of an economic downturn, because they did not like to lay their people off. After the corporate raiders got in and boosted their CEO salaries and sold off assets to look as if they were generating profits, IBM and many other large corporations were then dependent on banks for loans to cover operational expenses. Now we are told that if our major banks fail, that the operations of large corporations would cease as well because they no longer maintain their own operational funds.
    I have a sense that the funds that Apple is storing are not cash reserves but reinvested funds that are intended to create additional profit for shareholders. But either way, I can't really blame the corporations for wanting to get their cash out of the USA. With the predatory attitude of the government and other businesses and citizens and how they look hungrily at other people's assets, any company or person who has the ability to store their wealth elsewhere is responding to real threats. (Though I can't say I have a whole lot of confidence in the rest of the world that is trying hard to follow the bad but profitable example set by USA.)
    If the USA wants people to keep their assets here, they will have to have a radical switch back to respecting "savings" as other peoples sovereign asset and also understand that savings and investment (not spending) is what supports a healthy economy. As long as fractional banking allows a bank to lend 10 or 20 dollars for every dollar I save, they don't really need my money in their bank and don't have to pay much interest. Especially now if they will be able to demand that I keep my money in their banking system despite negative interest.
    The mega-corporations do seem to be getting away with something...I think this is more likely the many laws that get passed in the interests of large corporations that reduce competition by smaller competitors. We should not all jump on the bandwagon of looking at other's savings as a source of our own income. We should rather, ask how we could earn a similar income and save it. We should consider what laws have been passed since WWII (or even the US Civil War 1861-1865) that are a distinct advantage to government and corporations over small companies or individuals. Generally this will include any sort of licensing, certification, and tax and paperwork that is not actually required for safety reasons. They all bog down the small business person and give corporations an advantage while allowing government to suck up our money.
    Citizens have to license all sorts of stupid things -- non-motorized bicycles and kayaks for example, and pay a license fee. Why? Small businesses suffer in the same way. I know a company who keeps its daily cash in a plastic storage container because it doesn't want to pay taxes on a cash register.
    There is a guy in the USA who came up with an ingenious way to create affordable housing, better than any manufactured housing and has been blocked at every turn by government regulation. If you are interested, check this out: Micheal Reynolds - Earthships . It is long, but a good documentary.
    Grabbing savings is just the very last step of a long and insidious process to steal our money and our curb our ingenuity in every aspect of our lives.
    Converting our savings to gold will help for the time being, but in the long run the government will just try to take our gold through exchange fees or direct taxes or some such things. We have to have the switch back to gold be accompanied by sweeping removal of unnecessary laws, taxes and fees.
  • nigelmarkdiasnigelmarkdias Posts: 1,323 Silver ✭✭✭✭
    edited September 2016
    "I have a sense that the funds that Apple is storing are not cash reserves but reinvested funds that are intended to create additional profit for shareholders"
    The bigger you are the more choices you have e.g. Halliburton has moved lock stock & barrel from Houston, TX to Dubai, UAE.
  • RocketDogRocketDog Posts: 685 Silver ✭✭✭✭
    Well that's good for Texas and unfortunate for Dubai (because they are evil). Though I suppose Texas will miss the income.
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