A Third Of Cash Is Held By 5 US Tech Companies (siliconbeat.com)

An anonymous reader writes: Moody's Investors Service released an analysis Friday that shows Apple, Microsoft, Alphabet, Cisco Systems, and Oracle are sitting on $504 billion, which is roughly 30% of the $1.7 trillion in cash and cash equivalents held by U.S. non-financial companies in 2015. Almost all of their earnings ($1.2 trillion) are stashed overseas in an effort to avoid paying taxes on moving profits back to the U.S. under the country's complex tax code. Apple has more than 90 percent of its money located outside of the U.S., according to its most recent filings. Moody's said in its report that "we expect that overseas cash balances will continue to grow unless tax laws are changed to encourage companies to repatriate money." Some of the other tech and Silicon Valley companies in the top 50 include Intel, Gilead Sciences, Facebook, Amazon, Qualcomm, eBay, Hewlett-Packard and Yahoo.

Comments

Re:Remember where the responsibility is

[Carewolf]

The responsibility it to the shareholder, no the government.

Here I thought the responsibility of the tax code was to the voters.

Re:And trump wants to legalize tax evasion

[Anonymous Coward]

vs. the alternative, to continue letting them keep it out of the USA while occasionally moaning during a press conference about how unfair it all is. That's the Obama doctrine Hillary has vowed to uphold.

Do we need more corporate power?

[dbreeze]

I hope enough of us flesh and bone humans realize soon enough that corporations just aren't like us. Their interests and motivations are not ours. Either they will rule or we will rule. We had better get to work before it's too late.... http://www.movetoamend.org/

Lies

[don_combatant]

This story is misleading and irresponsible. There are many different measures of the US money supply including M0, M1, M2, M3, M4, adjusted monetary base, et al. The $1.7T number represents only the physically printed bills plus minted coins in circulation. M4 represents the total money supply including physical cash, bank balances, certificates of deposit, etc. Current US M3 money supply is approaching $20T, and the Treasury Department doesn't even divulge the M4 numbers anymore as per Federal Reserve Directive because they claim it's too difficult to calculate the total amount of US currency in circulation. READ: they don't want the proles knowing how much money is being pumped into the system post 2008 crash. The Fed alone has nearly $4T on their balance sheet and they don't even have legal authority to print money -- that's the Treasury Departments arena.

This story would only be accurate if those companies were holding the $500 billion in actual physical $100 bills in a vault. They are not. This $500 billion is merely entries in a database on a bank server and thus should be compared to the total M4 money supply, not M0. While $500B is a tremendous amount of money, the story would be much less shocking if the correct comparison was made.

"moving back"?

[superwiz]

That money was never taken out of the country, so why is it "moving it back"? If Apple sells an iPhone in Japan and it manufactured the phone in China, why should it deposit the profits on that money in a US bank?

Re:Remember where the responsibility is

[Sarten-X]

My point is that the actual laws dictating an executive's responsibilities rarely care at all about the shareholders. Rather, they usually only require that the company follow its charter, and it's that charter that defines the goals, and that's usually done vaguely.

In Apple's case, I don't see any definition of what the shareholders' interests are. It has been upheld in court that such a term can be construed to mean many things beside the often-assumed short-term profit goal. If Tim Cook thinks (and convinces the Board) that it's in shareholders' best interests to pay taxes to bring cash into the United States, then he can do so.

In essence, my point is to question the point of the original comment. Corporations are beholden to the laws of their jurisdictions, and those laws (in the US) make them subject to their charters. Blaming shareholders and invoking the profit myth implies that somehow the executives are being forced to do something distasteful, whether it's outsourcing or polluting or keeping foreign cash. The reality is that the executives have a wide range of options, and usually they only have to make a passable justification like "our polled shareholders said they care about the environment, so we're spending billions of dollars to have recycling in all facilities".

The myth essentially shifts the blame from the corporate executives to "the system". It's the same as the hippies' stereotypical disgust with The Man, the modern rebels' jealousy of the 1%, the historic persecution of Jews, and the vilifying of banks. Rather than a specific mechanism to effect change, such as participating in a shareholder poll or vote, the myth provides a vague target for outrage that the masses can rally against, feeling good about their impotent rebellion. It satisfies a craving to be a noble warrior in a community of fellow underdogs, fighting against a powerful oppressor... but it doesn't require the drudgery of actually changing anything.