Cahill admits the Merseysiders cannot compete in the transfer market but insists boss David Moyes has built an excellent squad full of homegrown kids and shrewd buys.
"I'm very, very confident about this season," he said. "Everyone can see our potential. It's important to keep our form going from last season.
"The only reason why people are talking about Manchester City - and Tottenham - is because they are the ones spending the money. We're not spending anything and it's the same thing every year.
"If we were spending that sort of money people would talk about us but we're breeding some great talent here and the manager has picked up some very shrewd buys."
The 30-year-old added: "I am really optimistic about our chances of doing well and finishing higher in the league."