about the structure of balance sheets, you can write a lot about how the cache behaves during recessions.
the main thing is that you do not have an opinion about, what:
companies accumulate cash during recessions (because they don't translate), and then they actively spend it.
in fact, the cache goes down at the beginning of the recession (commonly) and is the first to recover from the new cache flow. later, the cache level practically does not decrease, new cash flow is used for investments. ie. in itself the process of `` flowing from one to another" almost invisible.
at all, the cache level on the balance is determined at least:
1) dynamics of asset balance (the balance is growing – aggregates grow, and vice versa);
2) % ставками – the share of cash in assets is determined;
3) economic growth expectations – invest or not;
(Items 3 And 4 are two sides of the same coin)
4) dynamics and structure of liabilities (debt is growing – the provision for it grows, all other things being equal).
that's why, don't look for simple answers to complex questions.
all the more making strong statements based on a very small part of the picture.
the question arises further. OK, let it be like this in normal conditions, but our conditions are unusual and on the balance sheets of non-financial companies in the United States, the cash sizes reached record levels. here we stop, because it is not so.
it is not so easy to deduce a fair value of the cache. unequivocally, you need to use the indicator `` cache relative to something '', but the structure of balances is not constant. so you need to remember about the dynamics % rates.
I propose to do so:
1) use Cash / Liabilities
2) draw the current trend, see how much we strayed from it
3) we draw a trend based on, what dynamics % rates determines the direction of the trend in the ratio of cash to liabilities.
4) nobody claims, what time 10 year old treasuries at 50x level, means Kesh)Obligations should be in the same place (nevertheless the development of markets, liquidity and blah blah blah)
5) trend – not support level, and something around which fluctuations occur.
что получилось.
Now Cash / Liabilities = 10,8% (Z1 for 1q2010), 'should" to be 10%, difference = 0.8%.
Liabilities we have in the amount 13 816 794 000, 0,8% from her 111 074 000 – ie. $111 billion, ie. 0,76% GDP.
conclusions:
1) & quot; Excessive" recession exit cash is not used for 'investing', just believe me;)
2) There is no excess cache on balances"
3) If you score on everything, and believe, that everything is wonderful with us, regular recession and blah blah blah, more 1% from GDP I do not find to accelerate economic growth. Wherein, you need to remember, what if economic growth expectations are (will just be), then invest and so will. BUT $111 billion – this is not the amount that, by its size, will force management to make decisions under the weight of the mythical excess liquidity.
Резюмируя:
Economic growth will – the ratio of cash to other assets will decrease due to the growth of other assets.
There will be no growth – the share of cash in assets will grow.
Eventually – there is no excess cache argument. Simply no.
