Nonfinancial companies are sitting on $1.8 trillion in cash, roughly one-quarter more than at the beginning of the recession. And as several major firms report impressive earnings this week, the money continues to flow into firms' coffers.

Yet all the good news from big business hasn't translated into much promise for jobless Americans, leading many to wonder: If corporations are sitting on so much money, why aren't they hiring more workers?

The answer to that question has become a political flash point between the White House and big business groups such as the U.S. Chamber of Commerce, which held a jobs summit Wednesday and accused the Obama administration of dumping onerous regulations on businesses. That has created an environment of "uncertainty," which is causing firms to hold back on hiring as the unemployment rate has hovered near 10 percent, the Chamber said.

The White House countered that companies are wary of hiring not because of new regulations but because they're still waiting for consumer demand to return. The administration also claimed credit for 3.5 million jobs created by the stimulus bill from last year.

The acrimony over jobs comes at a particularly tense moment in the relationship between business groups and the White House. With the midterm elections looming and polls showing Americans expressing a lack of confidence in President Obama's handling of the economy, White House officials are eager to demonstrate that their policies are helping, not hurting, the prospects for job growth and are making an extra effort to reach out to industry leaders.

David Fuller's view This is a tricky issue for Democrats facing an election in November and a very difficult problem for the employable unemployed. All the White House and Congress can sensibly do is help to make the US a more attractive place to invest, for both American and overseas companies. Meanwhile, the bickering only adds to uncertainty. Business presumably feels that it will get a better deal after November when Democrats lose control of the House of Representatives and possibly the Senate as well.

How should investors view the current situation?

Medium-term uncertainty is likely to keep US investors cautious for a while longer. However, to ask the rhetorical question: Would you rather invest in companies which have lots of cash or very little cash?

Sooner or later, a chunk of that corporate cash will be used to invest in development projects, or for takeovers, or higher dividends. Meanwhile, investors should be reassured by the cash which indicates that companies are being prudent. It will help to cushion downside risk in the stock market.