Because having "leftover cash" that is not immediately redistributed to shareholders is seen as a Bad Thing (tm).
Because in the end, when shit hits the fan like with the 'rona, the government will be conveniently pressurable to bail you out. Personally, I rather have government bailouts than mass bankruptcies - but bailouts should come with "strings attached" like, let's say, a requirement to always keep one year of expenses at a reserve to avoid the need for future bailouts.
> "leftover cash" that is not immediately redistributed to shareholders is seen as a Bad Thing (tm)
sort of a short sighted view if that's really the case - since the cash being in the company's books, or in an endowment, is still value owned by the owner. The small penalty of it being illiquid shouldnt be a problem.
I guess, from a shareholder perspective, why would I want my investment to invest in other things/companies? Then they might as well pay out the money, so I could invest it myself.
And that is why government regulation is overdue to ensure a fair and level playing field without leaving the government on the hook in crisis scenarios.
Because in the end, when shit hits the fan like with the 'rona, the government will be conveniently pressurable to bail you out. Personally, I rather have government bailouts than mass bankruptcies - but bailouts should come with "strings attached" like, let's say, a requirement to always keep one year of expenses at a reserve to avoid the need for future bailouts.