Business: Excess Excitement

Most laymen would be hard put to it to define excess bank reserves, much less their significance. Last week, however, the public manifested a sudden interest in this prime index of potential credit. Excess reserves of all members of the Federal Reserve System rose $80,000,000. That was not a notable weekly gain and it was easily explained by the continued flow of gold to the U. S. What aroused the public's curiosity was the fact that the rise carried total excess reserves above the ponderous and unprecedented figure of $3,000,000,000.

As far...