Money: At New Peaks

Two separate but related kinds of financial crises crept closer to reality last week for the non-Communist world. The continuing Washington impasse over higher taxes and lower federal spending—the fiscal antidote for inflation—caused an ominous upward surge of U.S. interest rates. Abroad, the paralysis of France helped to lift gold prices to a new peak, renewing anxieties about the international monetary system. "We're all in the same boat," said Chairman Howard C. Petersen of Philadelphia's Fidelity Bank, "and it's not necessarily only our end of the boat that's leaking."

Interest-rate records toppled like tenpins last week in the Wall Street bond...