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Businesses of all shapes and sizes have faced economic headwinds since the onset of the Great Recession in late 2008. Obstacles to growth have been myriad, including tightened credit markets, weakened momentum in Asia, the ongoing Eurozone crisis, and near-zero interest rates.

The combination of these and other issues has compelled America’s CFOs to sit on their massive cash reserves. It was a reasonable response to the environment, and it resulted in the hoarding by corporate America of around $1.5 trillion in cash—equivalent to approximately 10 percent of the nation’s GDP. In fact, even as the economy has shown marked improvement, many businesses remain fearful that if they open the spigot on their reserves, a new crisis might emerge and cause a new liquidity crunch.

At a macroeconomic level, it’s a troubling cycle that has impacted the global economy. From 2010 through late 2013, as businesses stockpiled cash reserves, they also tamped down any expectation of job growth or robust economic expansion. By not spending, companies are failing to engage in the activities that could, at least theoretically, spur a strong recovery in the U.S. and perhaps even the world economy. The reluctance to put cash toward either capital expenditures or human capital (hiring) has convinced the Federal Reserve to extend its record-low interest rate environment through at least the middle of this year.

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