In Hobart Rowen's column yesterday, the quotation "My son and I" have been purchasing "sound common stocks" was incorrectly attributed to J.P. Morgan. That famous 1929 assurance was offered by John D. Rockefeller. (Published 10/22/87)

In a sense, it was the Reagan Revolution come full circle: the excesses of the past six years, visible in deficits near $200 billion a year in both the budget and trade, couldn't go on forever. Under Ronald Reagan, we have accumulated as much national debt as we had in the rest of the history of the republic. We have consumed and borrowed as if there were no tomorrow.

We made believe that huge debts could be allowed to accumulate in the Third World and that somehow failure of those loans could be neatly covered up on the books of the big banks. And never mind that the United States has become the world's biggest debtor, some of our seers have told us: in a pinch, we can always print the money to pay it off.

Now, the joy ride is over, but so far, the staggering, record stock market collapse, as it cascaded through the exchanges in New York, London, Tokyo and elsewhere, has been met with governmental denial reminiscent of 1929, when tycoon James P. Morgan tried to reassure the world by saying: ''My son and I are buying sound common stocks.'' It didn't work then, and it won't work now.

''The economy is fundamentally sound,'' said Treasury Secretary James A. Baker III. And President Reagan, who gives every evidence of being totally out of touch with reality, told reporters: ''I don't know what meaning it {the 508-point decline in the Dow Jones index} might have, all the business indices are up -- there's nothing wrong with the economy.''

We can emerge from panic and chaos only if government leaders of the free world are able to deal with the fact that while underlying conditions are not so grim as those prevailing in 1929, there is plenty wrong that needs to be addressed. Clearly, in a fear-driven atmosphere, the markets -- having skyrocketed too far -- have overshot in the other direction. But it is up to the major powers -- especially the United States, West Germany and Japan -- to show the leadership that will restore confidence.

The first priority must be reduction of the budget and trade deficits -- what former commerce secretary Peter G. Peterson calls the ''Twin Towers.'' And that will require that Reagan abandon his nearly psychotic aversion to any tax increase that would reduce the budget deficit. Yesterday, for the first time, he raised hopes he may modify his position.

Reagan can't do it alone. To get the budget deficit down, a Democratic Congress will have to meet the White House halfway by cutting expenditures.

''The most constructive thing this government could do,'' said Lazard Freres senior partner Felix Rohatyn on Black Monday, ''would be for the White House and the Democrats to come up with a credible deficit reduction plan, including something like a gasoline tax, and a freezing of entitlement programs and military spending. If you had a better fiscal policy, then the Federal Reserve could reduce interest rates by, say, two percentage points.''

That will be tough to accomplish, given the lame-duck inadequacy of the Reagan administration and the onset of a presidential campaign year. But the overriding need at this point is bipartisanship. Moreover, in this kind of emotional crisis, normal political infighting must be abandoned to ensure the defeat of protectionist legislation. More than ever, the global economy needs the restorative force of growth -- which would be stultified by the kind of trade barriers some members of both parties in Congress are trying to erect.

But individuals and businesses in the private sector can't look to government alone to pull them out of the present mess. As consumers in America, we must exert some self-discipline. What we can learn most usefully from Japan and other Asian countries is that working harder and saving more will pay off in the end.

In the next few days, investors here and in Europe and Japan will be looking for evidence that the recent weakening of the international resolve to cooperate on economic policy can be revived. Baker deserves great credit for having forged a network among finance ministers and central bankers that enables them to work together.

But frustrated last week by West Germany's manic fear of inflation -- at a time of zero rise in prices -- Baker went public with a threat that the United States would go its own way in making policy. ''He blew it,'' said an influential Wall Streeter. ''In the midst of market uncertainty, a secretary of the Treasury should avoid anything that could hurt stability.''

Baker, with the help of the Germans -- who have their own complaint about our foot-dragging on the budget-deficit issue -- is trying to repair the damage. ''Can they get the genie back in the bottle?'' asks economist Stephen Marris, who has been predicting some of the sorry events we have been experiencing. You should be able to get the answer to the question not on the business page, but on Page One.