Here is an update on this post, this one, and this one. Apparently, before fall 2008, standard Treasury procedure was to target the balance in the Treasury's balance in its General Account with the Fed at about $5 billion each day. The Treasury would then allow its balances in Treasury Tax and Loan Program (TTLP) accounts to fluctuate as funds flowed into and out of the Treasury. The idea was to both make life easier for the Fed, which in normal times targets the daily quantity of reserves to hit its fed funds target rate, and to earn interest on its cash balances. Targeting the fed funds rate would be more difficult if the Fed had to account for a fluctuating Treasury reserve balance, and interest on TTLP accounts with private depository institutions was significantly higher, pre-crisis, than the zero interest the Treasury would receive on the balance in its General Account with the Fed.
After fall 2008, however, Treasury procedures changed. You can find information on TTLP account balances here. The data is a bit awkward to look up, as there is a file for each date, but what this indicates is that the Treasury's TTLP balances are now fixed at a token $2 billion. The flip side of this is that it is the balance in the Treasury's General Account with the Fed that fluctuates. Why the change? First, of course, the Fed is not currently in the business of trying to hit a fed funds target. With more than $1 trillion in reserves in the system overnight and the interest rate on reserves pinning down overnight interest rates, the Fed appears to be unconcerned about the very large variance in the quantity of reserve balances held privately. Second, TTLP balances are essentially earning zero now, so there is no interest rate advantage for the Treasury in holding cash balances with the private sector.
Now, a key question is whether the fluctuations in private reserve balances matter. Clearly the Fed does not think so, and presumably banks would be kicking up a stink if this were actually disruptive. What this suggests is that dumping $600 billion in reserves into the system may not have any effect. The effects of QE2, if there are any, would then have to come solely from an effect on the term structure of interest rates from changing the relative supplies of long and short-maturity Treasury securities.