U.S. companies continue to hold record amounts of cash, according to a study by Standard & Poor's Ratings Services, and the high levels show no sign of dropping. Nonfinancial corporations rated by Standard & Poor's held $1.25 trillion in cash and short-term investments at the end of 2011, up 41% from the level at the end of 2006. Their ratio of cash and short-term investments to total assets increased to more than 8.6% from 7% between 2006 and 2008.

The increase in liquidity was greater for investment-grade companies, though speculative-grade issuers increased their cash reserves as well. Cash and equivalents recorded by investment-grade issuers showed a compound annual growth rate (CAGR) of 8.7% over the past five years, while speculative-grade issuers recorded a 2.3% CAGR.

Companies that are rated A or higher held 54% of the total cash and short-term investments as of 2011, even though they comprise only 10% of issuers. Companies rated B and lower held only 10% of the cash and short-term investments, though they make up 46% of issuers.

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