Cash-rich companies offer safety cushion

"Now altruistically, you'd as well like to see the money being usedin job creation, factory building and expansion of businesses somore manufacturing is done here instead of overseas."

- Microsoft Corp., the software giant that generates morethan $1 billion in cash flow each month, has bought back largeamounts of its own stock and has an AAA debt rating. Its wealth ofcash for innovation and development makes it one of the few firmswith the research and financial resources to invest heavily incloud computing, the emerging field in which hosted services aredelivered on-demand over the Internet.

Not that it is always a good thing. Having a lot of cash cansometimes mean that money isn't being spent where it should be toimprove the overall business. We are exiting the period in whichcost-cutting was revered for cost-cutting's sake alone. The realityis that firms can't in effect grow by cutting back.

"Look at where a company's cash is coming from - whether it isfrom sales and it is just booking the cash, or whether it isselling assets or closing plants," added Wright. "You don't want tosee all that cash coming from shrinking its business."

Goldman points to Microsoft, Apple Inc. and CaterpillarInc. as notable examples of cash-rich companies. Ford MotorCo. issued considerable debt just previously the economic downturn,so it had ample cash on hand to weather the storm, he added.