NOTE: IF YOU HAVE NOT MADE CARAMEL SAUCE BEFORE, PLEASE BE VERY CAREFUL. THE SUGAR IS EXTREMELY HOT AND CAN CAUSE SEVERE BURNS.
In a medium pot, boil the sugar and water together over medium to low heat until the sugar caramelizes and turns golden brown. Be sure not to stir the mixture as the sugar heats. This will take approximately 7 to 15 minutes.
Once the sugar is golden, immediately remove the pot from the stove and carefully whisk in the cream. Wear oven mitts and be very careful. The cold cream will splatter when it hits the hot sugar. Once the cream has been added, whisk in the butter one tablespoon at a time. Then set the caramel aside to cool slightly as it will still be very hot.
Serve warm or at room temperature with cakes, tarts, ice cream or even French toast. Any leftover caramel sauce can be kept in a plastic container or squeeze bottle and stored in the refrigerator for quite a few days.
Note: Instead of using salted butter, you can use unsalted butter and season the sauce at the end with a bit of fleur de sel or gray salt.