> For everyone wondering why the large cash balances on company books, this is why. You have that backwards. Companies are generating vast amounts of cash and

> For everyone wondering why the large cash balances on company books, this is why. You have that backwards. Companies are generating vast amounts of cash and don't see investments that they want to make (hiring and expanding into new products, acquisitions, etc), which leads to the large cash piles. Some investors then pressure the company to return part of this cash to shareholders (see Carl Icahn / Apple for a recent and high profile example), and that can be done directly via dividends, somewhat indirectly via buybacks, or both. Companies do not spend 'rainy day' money on buybacks - companies in need of additional funds sell more shares or take on more debt, not use cash to buy shares.