"cat" command fails to create a usable txt file. Is there something I need to make sure of?

If you are still in the Bash 3 shell, you can create an empty file by the following commands in the Terminal:

>foo.txt

or

touch foo.txt

or

echo "" > foo.txt

or

cat /dev/null > foo.txt

All but the first example work in the Zsh shell. Ordinarily, on a UNIX system, one does not use cat in this manner to create an empty file, but rather the touch command. The cat command is more for concatenating n-tuple files into a final file, or reviewing the content of an existing text file for bogus line endings, to name a couple of usages.