cash investments: Investments with a term of 12 months or less. Some of the assets backing the issuance of the private currency will be cash assets. This is necessary for a number of reasons. First, there will be a continuous stream of USD coming into the sponsor as the MR$ notes are sold. This cash will be pooled, until the proper present value assets can be purchased. Secondly, the sponsor will be offering monetary conversion services to convert MR$ into USD. While the sponsor has the right to hypothecate the present value assets to fund the monetary conversion services, it may be more cost efficient to simply use the recent cash obtained in the sale of the MR$ notes to perform monetary conversions. Finally, the sponsor may invest in some cash investments for the purpose of greater liquidity and/or to encourage the broader use of the MR$ notes. As an example, the company may purchase bank certificates of deposit to encourage banks to issue loans, and other services, in real terms. Nonetheless, the sponsor is required to make up any shortfall in the inflationary adjustment on the cash investments to meet the present value test. The sponsor is also liable for any default on the cash investments; whereas, it is not responsible for any default on the non-cash inflation-indexed assets. See: non-recourse.