period 27 per cent of Yale's investments were in bonds, 54 per cent of Harvard's, and for the independent colleges, 50 per cent. Such large differences in investment policy among major universities are not likely now.5
By the 1930s it became increasingly clear that it was difficult to play safe. For example, a trustee of Lehigh University said: "A great criticism against trust companies and trustees charged with the investment of funds is that they have been actuated more by an effort to play safe and according to certain formulas, rather than to exercise personal vigilance and watchful care over not only the preservation, but also the enhancements of funds for which they are held responsible."
It was Oliver Wendell Holmes who said: "Every year, if not every day, we have to wager our salvation upon some prophesy based upon imperfect knowledge."6
Looking back, it is easy to see that many mistakes were made. For example, from 1938 to 1947, 12 institutions increased their holdings of bonds from $166 million to $228 million, and the percentages of bonds to total investment from 38.7 to 42.9. By this time the probability and fact of inflation was clearly evident, and this might seem like poor policy. However, this increase is explained in part by the need of supporting the government-bond market in the midst of war, although the sacrifice of income to patriotic impulse varied from college to college. By 1947 Dartmouth had put 13.5 per cent of its total investments in government bonds, and Columbia 14 per cent, whereas Oberlin had 41.5 per cent and Harvard 35 per cent. Even by 1947 these 12 institutions had increased their proportion of investments in common stocks (book value) from 22 to 29 per cent, a relatively small rise in view of the economic conditions. Those with the highest proportion in stocks were Mount Holyoke with 41 per cent, and Harvard with 38: and the lowest proportion, Carnegie with 14 and Columbia with 17 per cent.7