$100,000

Wall Street prides itself upon its practicality, and its freedom from academic theory. Recently, however, it has been engaged in a curiously theoretical dispute. An innocent reader of the Wall Street Journal sent the editor a query as to how he could invest $100,000 to best advantage, 20% in bonds and 80% in common stocks. The Wall Street Journal published it, thereby casting a golden apple of discord throughout the financial community.

Several bond houses wrote back, politely but firmly discountenancing the notion of preferring stocks to bonds as investments.

Back of the dispute about the inquirer's $100,000, as a matter of fact, lie several serious questions of economic theory. Some months ago, a Wall Street iconoclast, Edgar L. Smith, wrote a book, Common Stocks as Long Term Investments, which proved that shares were better long pull investments than bonds. This caused no small ruffling in the Wall Street dovecote, especially among its bond houses, but Mr. Smith's figures were persuasive. Now, with the public seriously preferring shares to bonds, some Wall Street bond dealers feel that the pendulum is swinging too far in its new direction.