I don't think it's that simple. There are few more factors at play: For one, the markets are risky. Let's not forget that just a few years ago, bonds which wer

I don't think it's that simple. There are few more factors at play: For one, the markets are risky. Let's not forget that just a few years ago, bonds which were supposedly rated AAA were nothing but air. The entire economic system collapsed quite literally overnight. Many people lost faith in the "system". Currently our debt levels are higher than any economist is comfortable with, and just like in the case with the subprime mortgages, there is huge political pressure to keep the government's AAA rating, whether deserved or not: https://en.wikipedia.org/wiki/United_States_federal_government_credit-rating_downgrades https://en.wikipedia.org/wiki/United_States_federal_governme... Additionally, over the past decade we've seen an huge rise in the number of startups, and the number of companies looking to "disrupt" entire industries. In 2016, it's not completely unreasonable that a billion dollar company could go bankrupt within a few years due to whatever disruption comes from left field. Hoarding cash is a hedge against this type of risk, as it allows large companies to be flexible, acquire smaller, potential threats, or go on the offensive if/when it becomes necessary. i.e. Facebook's acquisition of Whatsapp for 19B