Broker Opposes Galbraith's View

The world's biggest stock brakes, Winthrop H. Smith, disagreed yesterday with the recommendation by John E. Galbraith, professor of Economics, that stock buying should be put on an all-cash basic to prevent a repeat of the 1920 coach.

In his statement, Galbraith said that buying on the market may reach the type of speculative hysteria which led to the 1929 depression. To forestall this possibility, he proposed that stock buying should be conducted with a 100 percent margin instead of a 60 percent margin.

Smith commented, however, that breakers and underwriters have played only a minor role in the rise of the stock market. He feels that it is confidence in sound values, not the level of the margin, which moves a person to invest his money.

Smith thought that the current rise in the stock market was not due to any form of speculative hysteria, but to faith in the growth and stability of American economy.

Arthur Smithies, professor of Economics, agreed with Smith on the idea that there is little need for precautionary measures. It is his opinion that the market will remain relatively stable, regardless of any changes made in the present stock-buying system.

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