Quote Originally Posted by Elldallan View Post
I sort of agree with this, as long as the wealth stays with a company and they keep reinvesting it it isn't a problem, it drives the economy. The problem arises when they sit on the cash or make huge payouts to stock owners(especially when these payouts ends up with a select few individuals), or when they buy off policitians.
Yes, but the cash that is hoarded by companies or paid out to stock owners don't end up under the mattresses. They go into the banking system, and from there new loans are made. It might not be the company reinvesting the money themselves. But someone else will borrow the money from the banks and do it.

Now we hear that banks aren't lending much to businesses now. That's true, because they are lending tons of money to the government (by buying treasuries) and because the Fed is printing money to pay these banks interest so that the banks will keep the money with the Fed.