“If this is a rainy-day fund, they’re saving for a millennial flood,” Georgetown University’s finance professor Lee Pinkowitz told The Wall Street Journal.
Apple’s cash pile has swelled to $250bn, a sum bigger than the market value of Wal-Mart or Procter & Gamble. It also eclipses the foreign currency reserves of Britain and Canada combined.
Apple’s lucrative products help explain why the cash pile has burgeoned; so does the group’s historic tendency to avoid big acquisitions as well as dividends or buybacks. Ninety per cent of the money is held overseas to avoid high US corporate taxes.
Viewpoint
“French productivity, measured by GDP per hour worked, is higher than in Britain to an almost embarrassing extent. Figures published by the Office for National Statistics this month showed that productivity in France is 29.4% higher… I have always argued that this is because Britain is a higher-employment, lower-investment economy than France, where restrictive labour laws discourage employment and, where it is an alternative, encourage firms to invest. While a machine gets on with it, a French worker responds with a Gallic shrug. But that French worker has significantly more capital equipment than their British equivalent.”
David Smith, The Sunday Times