Business: Cause for Alarm?

When the Commerce Department reported last week that business inventories had risen $2.5 billion since last August—to a new record of $75 billion—some businessmen began to jitter. Are inventories too big? Is there danger of a break in prices that might bring on a recession?

Actually, warehouses are storing more goods because with rising sales manufacturers are producing more, and consequently more goods are in transit. In some cities there were signs that inventories were getting too big in a few items, e.g., electrical appliances. But General Electric reported last week that, overall, appliances are moving so fast that its own inventories...

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