Where do large corporations store their massive amounts of cash?
You can find out the general types of investments by reading the public corporation 10-Q report that is filed with the SEC it can be accessed via the EDGAR system. It will not tell you what securities they have, but it does identify the short term and long term investments categories and their value. Short term investments, treasuries, current accounts. They are using several banks, hedge funds or other financial institutions, in order to diversify the risk inherent to the fact that the firm holding (a fraction of) their cash, can be insolvent which would makes them incur a really big loss. Also, the most available form of cash is very often reinvested everyday in overnight*products and any other highly liquid products, so that it can be available quickly if needed. Since they are aware that they are not likely to need all of their cash in one day, they also use longer terms or less liquid investments (bonds, stocks, etc..). For tax optimization, cash is stored mostly overseas, according to the New York Times. For Apple, everytime a song or an app is bought in Europe, Africa or Middle East, money flows to iTunes Sàrl, in Luxemburg. Royalties on patents flow internally from Apple in California to Apple in Ireland. Then profits flow to the Carribean. The problem is that cash cannot be brought back to the USA without huge taxes.
Generally you don't exclude cash that is needed to keep working capital going. A firm's need to cash will vary based upon it's AR and AP policies. Some companies that have beat up their vendors and extract harsh payment terms, like Dell and Walmart, often have negative working capital and can therefore be thought of as funding growth on their suppliers cash. Most companies require some amount of cash in their working capital to connect the dots from when they pay their suppliers and when their customers pay them. You need to leave that cash in your working capital calculation and on your DCF. They made their money one of two ways.  Either they got a commission from the original owner (similar to how a buyer's agent in a real estate transaction gets a commission from the original owner of the house and/or a share of the seller's agent's commission), or they actually participated in the transaction directly (buying from the original owner, selling to you at a higher price). Storing it in the vault free of charge of course has an expectation that a certain percentage of those who do so will use that broker to complete the eventual sale. "This is second hand information as I am not a millionaire, but I work with such people everyday and have an understanding of how they handle cash: The wealthy people don't. Simple. Definitely not if they don't have to. Cash is a tool to them that they use only if they get benefit of it being a cash transaction (one of my friends is a re-seller and he gets a 10% discount from suppliers for settling lines using cash). Everything else they place on a line of credit. For people who ""dislike"" credit cards and pay using ATM or debit cards might actually have a very poor understanding of leverage. I assure you, the wealthy people have a very good understanding of it! Frankly, wealthy people pay less for everything, but they deserve it because of the extreme amount of leverage they have built for themselves. Their APRs are low, their credit limits are insanely high, they have longer billing periods and they get spoiled by credit card vendors all the time. For example, when you buy your groceries at Walmart, you pay at least a 4% markup because that's the standardized cost of processing credit cards. Even if you paid in cash! A wealthy person uses his credit card to pay for the same but earns the same percentage amount in cash back, points and what not. I am sure littleadv placed the car purchase on his credit card for similar reasons! The even more wealthy have their groceries shipped to their houses and if they pay cash I won't be surprised if they actually end up paying much less for fresh (organic) vegetables than what equivalent produce at Walmart would get them! I apologize for not being able to provide citations for these points I make as they are personal observations." If you want to store that much money, find a good hiding place. (E-mail me the location.  I'll keep it a secret.  I promise!) But I think instead you want to invest that much money, in a cash-like liquid form. You can do $250,000 in a bank (beyond 2012) and then spread the rest over some big-name brokerages with money market accounts. But, as JohnFx pointed out, with that much cash you can do amazing things with it.  Think bigger. "Most of your money doesn't exist as physical cash, but simply as numbers in a ledger. At any given time, banks expect their clients to withdraw a certain percentage of their balances... For instance, checking accounts are frequently drawn down to zero, savings accounts might be emptied once our twice a year, CDs are almost never withdrawn, etc. To cover those withdrawals, banks keep a certain amount of physical cash on hand, and an additional amount remains on the ledgers. The rest gets loaned out to their customers for use in buying homes, cars, credit cards,etc. Anything they can't loan out directly gets deposited with the federal reserve or loaned directly to other institutions who need it. However, those last two options tend to be short term (ie overnight) loans. With debit cards functioning 24/7, you could get cash at an atm or make a purchase anytime of the day our night. The weekend has nothing to do with it. Which is a long way of saying ""No, they do it all the time, not just on weekends"" ;)" "This will happen automatically when you open an interest-bearing account with a bank.   You didn't think that banks just kept all that cash in a vault somewhere, did you?  That's not the way modern banking works.   Today (and for a long, long time) banks will keep only a small fraction of their deposits on hand (called the ""reserve"") to fund daily withdrawals and other operations.  The rest they routinely lend out to other customers, which is how they pay for their operations (someone has to pay all those tellers, branch managers, loan officers) and pay interest on your deposits, as well as a profit for their owners (it's not a charity service).  The fees charged for loan origination, as well as the difference between the loan interest rate and the deposit rate, make up the profit.   Banks rarely hold their own loans.  Instead, they will sell the loans in portfolios to investors, sometimes retaining servicing rights (they continue to collect the payments and pass them on) and sometimes not (the payments are now due to someone else).  This allows them to make more loans.   Banks may sometimes not have enough capital on hand.  In this case, they can make inter-bank loans to meet their short-term needs.  In some cases, they'll take those loans from a government central bank.  In the US, this is ""The Fed"", or the Federal Reserve Bank.   In the US, back around the late 1920's, and again in the 1980's some banks experienced a ""run"", or a situation where people lost confidence in the bank and wanted to withdraw their money.  This caused the bank to have insufficient funds to support the withdrawals, so not everyone got their money.  People panicked, and others wanted to take their money out, which caused the situation to snowball.  This is how many banks failed.  (In the '80s, it was savings-and-loans that failed - still a kind of ""bank"".)  Today, we have the FDIC (Federal Deposit Insurance Corporation) to protect depositors.  In the crashes in the early 2000's, many banks closed up one night and opened the next in a conservatorship, and then were literally doing business as a new bank without depositors (necessarily) even knowing.  This protected the consumers.  The bank (as a company) and its owners were not protected." I just listened to a podcast on this topic this week, and Satanicpuppy is pretty much correct. If you are interested, here is a link to the podcast on Legal Lad: Can Businesses Refuse to Accept Cash? Trader Joe's operates in 100% cash, no debt.  No unions, no shareholders to answer to. The owners don't take any of the money.  All the money is circulated back into the company.  They lease small buildings and pay the rent in advance. The US does have a gold reserve. The main reserves are held at Fort Knox but there is even more gold, mostly owned by other countries, stored in the basement of the New York Federal Reserve Bank (Think Die Hard 3). The United States Bullion Depository, often known as Fort Knox, is a fortified vault building located adjacent to Fort Knox, Kentucky, used to store a large portion of United States official gold reserves and occasionally other precious items belonging or entrusted to the federal government. The United States Bullion Depository holds 4,578 metric tons (5046 tons) of gold bullion (147.2 million oz. troy). This is roughly 2.5% of all the gold ever refined throughout human history. Even so, the depository is second in the United States to the Federal Reserve Bank of New York's underground vault in Manhattan, which holds 7,000 metric tons (7716 tons) of gold bullion (225.1 million oz. troy), some of it in trust for foreign nations, central banks and official international organizations. Source: Wikipedia So ... how are you going to have a bank run if you got rid of cash? I suspect big investors will attempt (have already attempted?) to pull their cash, but regular people? Not like running to the ATM will do much good and I don't think they have offshore accounts.  Excuse my naïveté, but that's the first thing that came to my mind... The Bank Secrecy Act of 1970 requires that banks assist the U.S. Gov't in identifying and preventing money laundering. This means they're required to keep records of cash transactions of Negotiable Instruments, and report any such transactions with a daily aggregate limit of a value greater than (or equal to?) $10,000. Because of this, the business which is issuing the money order is also required to record this transaction to report it to the bank, who then holds the records in case FinCEN wants to review the transactions. EDITED: Added clarification on the $10,000 rule "In May 2011, a report to the board by Promontory Financial Group, a Washington consultant hired as part of the CFTC Dooley settlement, concluded that the firm had vastly improved"" its systems and risk controls, and praised management for setting ""a tone at the top"" supporting ""best practices.""    I actually did some technology work for Promontory Financial Group for a short period.  What a bunch of tools.  They had a nice office in a newer office building in the business district of Washington DC, not far from the Treasury.  Their ""server room"" was actually a closet.  The number of servers they had produced a lot of heat.  It had minimal ventiliation.  Their solution?  Bring in a portable A/C unit.  Great, but due to the humidity and the amount of heat/energy transfer, it produced a lot of condensation runoff.  There was no drain.     The solution?  Think of the largest Rubbermaid outdoor garbage can that you can buy, and put it under the unit to collect the condensation output.  It was probably 50 gallons.  It filled up in about three or four days, an indication of the output.  Part of the nightly cleaning crew's responsibility was to bail (literally) the water out of the can, and put it in a mop bucket, and wheel it down to the cleaning closet that did have a sink and empty it.  The can had wheels, but who would want to risk rolling 400 pounds of water on tinkery casters down a lavish passageway?    Problem?  On long weekends/holidays, there was no cleaning crew.  So they purchased a ""Mister Sensaphone"" (yes there really was such a device), so that when the can started to overflow, the moisture detector would trigger, it would page the system administrator, and they would drive into the office and bail it out.    All of that because they did not want to pay $30,000 to install additional ac capacity on the roof and ventilate their server room.   I think they were actually proud of this setup, like it was a demonstration of some ""out of the box"" creativity." There's nothing particularly special about a two million dollar cheque. While they aren't commonplace, the bank certainly has experience with them. Many ATMs won't allow a deposit of that size but the bank cashiers will certainly accept them. They will typically get a supervisor to sign off on the deposit and may ask about the source of the money, for fraud prevention reasons. They may be held for longer than a smaller cheque if the bank manager chooses to do so. If there's nothing remotely suspicious (for example, it is a cheque from an insurance company for an expected payout), you should expect it will clear in about a week. On the other hand, if it is a cheque from a bank in another country and the bank manager has any reason to suspect it may not be legitimate, they may hold it for a month or more. Even then, you are not guaranteed the cheque was legitimate. This is used in a common scam. "Typical for large companies.  My company isn't declaring bankruptcy but every year they ""run out"" of money for us to take legitimate business trips to support customers.  Meanwhile executives are constantly flying around so they can give speeches that say nothing to people who don't care.  Even if they just stopped spending so much when they traveled (international first class tickets are crazy expensive) we'd probably still have enough to go around." big banks are not the only Big Money out there.  In fact, big banks have way more oversight than most other businesses.  Everyone uses banks for most things.  It's kind of hard NOT to these days.  But banks are built to handle money.  That's what they do!  Of COURSE banks are almost always involved in everything that requires money.  I don't understand why you brought this up at all.  It doesn't really support your point, and has little to do with my point.