Cabot Reveals College's Past Financial Woe

Harvard's wealth is new-found. One hundred years ago, the University did not even have $1,000,000 in investments, while today it has about $200,000,000 in endowment.

Writing in the current Alumni Bulletin issued yesterday. Treasurer Paul C. Cabot '21 recalls three centuries of the University's financial high points and woes.

John Hancock was one of the College's poorer treasurers. "He refused to make accountings or to heed pointed suggestions that he resign," writes Cabot "Finally, when he was away from Boston as President of the Continental Congress one of the Harvard tutors was sent to him by the Corporation to receive the papers and securities in his hands, and succeeded in getting from him 18,000 pounds sterling of the College securities.

"The rest of the property was not returned until after Mr. Hancock's death sixteen years later."

Early stocks do not seem to have been too successful. Some were finally written off as a "Doubtful and Disparate Debt Harvard had two shares of the Charles River Bridge at $3,000 a share; but the advent of free bridges across the river ended this as a source of revenue." The University did try to convince the legislature that Massachusetts owed Harvard repayment for the bridge's annihilation as "productive estate."

When "greenbacks" were introduced at the start of the Civil War, the University turned to real estate. Through the years Harvard has moved from one type of investment to another.

In the early days of the 19th century, the College bought bonds rather than its previous favorite, mortgages and notes. Common stocks did not enter the University picture significantly until the 1930's. Today, the treasure has $3,000,000 alone of General Electric stock.

During the war years, Harvard discovered government bonds for investment and in 1950 owned $61,000,000 of them.

Today the complex financial picture is simplified by having the treasurer annually announce in advance how much he is guaranteeing on all endowment money. Next year this figure rises to 4.3 percent--up .1 percent. This seems to show a continued improvement in the general economic, picture, for Harvard's widely-scattered investments only were guaranteed for 4 percent from 1944 to 1949