WSJ: "Borrowing to Save"
The Wall Street Journal writes "Borrowing to Save", which says about corporate treasurers, "Having cash on the balance sheet -- previously unfashionable -- is now all the rage. With banks reining in lending, companies have rushed to lock in financing from the bond market while they can: non-financial companies have issued over $200 billion of debt in the U.S. and Europe so far this year." The Journal adds, "Two years ago, building cash piles would have been a red rag to an activist investor. But in the current environment it is more likely to be viewed as an insurance premium. With very little visibility on earnings, and debt maturities to meet in the coming years, borrowing cash now could ensure a company's survival if bond market investors go on strike." See also, Bloomberg's "General Electric Rises as S&P's Ratings Cut Eases Concern", which says, "S&P left GE and GE Capital's commercial paper ratings at A-1+ and said the rating for debt sold backed by the Federal Deposit Insurance Corp. remains AAA."
