University's Endowment Soars Above $1 Billion Level

Harvard is a billionaire. Paul C. Cabot '21, treasurer of Harvard College, said yesterday that Harvard's endowment has moved above $1 billion.

The figure represents an eight per cent increase over last June's $916.5 million total. According to the rise is due to a general upward trend in the stock market. He emphasized that no special gift had contributed to the new high, noting that the $1 billion level had been expected for some time.

During the last four years, Harvard has averaged almost $40 million a year in gifts and bequests, according to the John Price Jones Co., Inc., an investment consultant.

Harvard now surpasses by about $200 million the country's next richest institution, the University of Texas. Among the Ivy League schools, Yale is first behind Harvard, followed by Columbia and Princeton.

Cabot denied rumors that the University is embarassed about the achievement, fearing a drop in contributions. He noted that the endowment fund covers only about 20 per cent of Harvard's total budget, and that the expenses of the University have increased tremendously in the last 25 years. Cabot said that two decades ago the endowment met more than 25 per cent of the total expenses.

Since June, 1955, the endowment fund of the University has doubled and since Cabot's installation as treasurer in 1948, the fund has increased almost five times over. Cabot originated the policy of investing Harvard's money in common-stock investments, rather than the previously traditional holdings in mortgages, long-term bonds, and real estate. His successful policy at Harvard has been copied by most other university endowment funds.

Cabot does not expect the fund to level off at this point, but he noted that he cannot predict the stock market. Harvard's stock include $10 million invested in DuPont, $12.5 million in General Motors, and $26 million in IBM.

Cabot will retire from his post in June, and will be succeeded by George F. Bennett '33, deputy treasurer of Harvard College. When Cabot began his tenure 17 years ago, he convinced the Harvard Corporation to hire an investment management firm to supervise the University's investments.

After his retirement, Cabot expects to stay active in his own private investment business.

During the last four years, Harvard has averaged almost $40 million a year in gifts and bequests, according to the John Price Jones Co., Inc., an investment consultant.

Harvard now surpasses by about $200 million the country's next richest institution, the University of Texas. Among the Ivy League schools, Yale is first behind Harvard, followed by Columbia and Princeton.

Cabot denied rumors that the University is embarassed about the achievement, fearing a drop in contributions. He noted that the endowment fund covers only about 20 per cent of Harvard's total budget, and that the expenses of the University have increased tremendously in the last 25 years. Cabot said that two decades ago the endowment met more than 25 per cent of the total expenses.

Since June, 1955, the endowment fund of the University has doubled and since Cabot's installation as treasurer in 1948, the fund has increased almost five times over. Cabot originated the policy of investing Harvard's money in common-stock investments, rather than the previously traditional holdings in mortgages, long-term bonds, and real estate. His successful policy at Harvard has been copied by most other university endowment funds.

Cabot does not expect the fund to level off at this point, but he noted that he cannot predict the stock market. Harvard's stock include $10 million invested in DuPont, $12.5 million in General Motors, and $26 million in IBM.

Cabot will retire from his post in June, and will be succeeded by George F. Bennett '33, deputy treasurer of Harvard College. When Cabot began his tenure 17 years ago, he convinced the Harvard Corporation to hire an investment management firm to supervise the University's investments.

After his retirement, Cabot expects to stay active in his own private investment business.