I I TABELL-S I MARKET LETTER L — 909 STATE ROAD, PRINCETON, NEW JERSEY 08540 DIVISION OF MEMBEA NEW VORK STOCK EXCHANGE, INC MEMBER AMERICAN STOCK eXCHANGE July 27, 1973 —– '– – . ;.—….- –….;.- .–'',.. o-'– …,.!!…,….2.– —……… ….—-. – -; Market forecasters are often accused, perhaps rightly so, of hedging but, as we have pOinted out in the past, the exigencies of the situation often require a complex answer to a fairly simple question. In the light of rapidly improving stock prices, the most commonly asked question of last week was whether the 1973 market downswing had seen its lows. It is unfortunately a question that cannot be answered simply. Most recent comment on the market of the past three weeks has centered around the sharp recovery of the Dow which now, having reached an intra-day high of 944.08 on Thursday, is up over 80 pOints from its low, scored earlier this month. Yet to us, the most interesting facet of recent market action has been not the extent of advance but its character. As we have been pOinting out consistently over the past six months, the popular averages of stock market performance, such as the Dow and S & p 500, have given a false impression of strength in contrast to the action of the average stock as mea- sured by unweighted indices such as our own cumulative index. The rally from November 1972 to January of 1973 looked quite dynamic in the Dow but in terms of our cumulative index was scarcely a ripple, and, after the market topped, while the Dow decllned only 17, the cumulative index fell by an amount that qualifies as a major bear market by any standard. It is precisely this discrepancy that has been reversed on the recent market rally. The following table tells the story 1973 High 1973 Low Decline Close 7/25/73 Adv. Dow-Jones Industrial Average 1067.20 863.94 19.0 933.02 8.0 S&P500 121.74100.44 17.5 109.64 9.2 ;pmuh,e.!nd. . . .1066.91 \i46.01.– 9 …5. .22.66.,.. 1;;;l;-o.9,,,c1 As the table shows the Dow and the S & P were off by a relatively modest amount in 19-73. At the — same time the cumulative index was posting an almost -40 decline. Yet on the recovery through Wednesday, the advance posted by the popular indices was measurably less than that shown by the cumulative index. The same phenomenon can be illustrated by showing the action of four popular growth favorites and four representative severe ca sualties of the bear market. The growth issues strongly outperformed the others on the market decline, but, on the recent rally, a sharp form reversal was evident with the bear market casualties having turned in a far stronger performance through last week. Decline Advance Decline Advance 197J.,3 High-1973 Low 1973 Low- 7/25/73 197J.,3 Hlgh-1973 Low 1973 Low-7/25/73 IBM 19.2 8. 1 Tropicana Products 73.5 79.7 Xerox 18.8 14.7 Skyline Corp. 81.8 66.7 Avon Products 21.4 6.6 Northwest Airlines 67.3 32.0 McDonalds 32.6 28.8 AMFInc. 67.8 29.5 Forces as powerful as this, once set into motion, are often difficult to reverse and we would expect the better performance on the part of second-tier issues to continue, even going so far as to offer this prediction as a forecast on which investment policy can be based. We can carry it even further to say that there is now a high degree of probability that unweighted indices, such as our cumulative index, may well have seen their effective lows—this not precluding a test of these lows at some later date. weThe trouble is that this does not help us very much in formulating a forecast for the popular aver- ages. As said-abOVe, -we wOilldex-pect' the—–gapb.rtWeen these -aVerages -andun;;;eighted indiceS, – a gap which had been widening for a couple of years and has just now started to narrow, to continue to narrow even further. The problem is that it is difficult to say at the moment whether this resolution will take place on the upside or the downside. The answer to this question requires further evidence. The present probable market pattern allows time for such evidence to accumulate. It is probable that future leadership will come from those issues which have been the severest casualties of the 1973 bear market. Many of these issues have already risen sharply from their lows and will need a further period of base formation before embarking on long-term advances. Future policy should be directed toward accumulation of such issues as the individual stock patterns become clearer. Dow-Jones Industrials (1200 p.m.) 933.70 S & P Compo (1200 p.m.) 109.64 AWTrk ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL No statement Of expression of opinion or ony other matler herein contOlned 15, or IS to be deemed to be, directly or ,directly, on offer or the SOllCllotlon of an oHer to buy or sell any seCUrity referred 10 or mentioned The matter IS presented merely for the conver'lenCE; of the subscriber While -He believe the sources of our ,formation to be reliable, we In no way represent or guarantee the accuracy thereof nor of the statements mude herein Any action to be taken by the subscriber should be based on hu own ,vestlgahon and Informahon Janney Montgomery Scott, Inc, as a corporation, and Its offICers or employees, may now have, or may iater loke, poslhons or trades In respect to any secunltes menttoned In Ih,s or any future Issue, and such paslhon may be different from any views now or hereafter expressed ' thIS or any alher Issue Janney Monlgomery Scali, Inc, which IS regIstered wtlh the SEC as on Investment adVisor, may give adVice to lIs Investment adVISOry and athel customers Independently of any statements mode, thIS or In any other Issue Further Informahon on cny securtty mentIoned herem IS avaIlable on request

TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON, NEW JERSEY 08540 DIVISION OF MEMBER NEW YORK STOCK eXCHANGE, INC MEMBER AMERICAN STOCK eXCHANGe August 2, 1973 – -….– – One – of the — — — —- – – — – –'-' — great psychological differences between —- htili and – – – bear markets is i n – ve l – s t or -.– attitude towards short-term declines. In the advanced stages of market upswings, such declines are viewed with equanimity, in total confidence that they will shortly reverse themselves and that the market will move ahead to new highs. In the advanced stages of downswings and around market bottoms, however, a good one-day down market is guaranteed to rekindle pessimism. Such was the case last week when the Dow, having shown improved technical action for some six weeks, sharply reversed itself and plunged some 25 points over the four-day period ended Thursday with a fourteen-point Wednesday decline contri- buting the bulk of the damage. Even more dismal was the action of the Dow-Jones Utility Average, often regarding as a leading indicator, which joined in the decline by plunging to a new 1973 low. It is a time when it is a good deal easier to formulate investment policy than to make a market forecast. We have been suggesting in this space for some time that the market's deteriorating technical action made advisable the maintenance of some buying reserve. The question, throughout all of 1973 thus far, has been whether or not such reserves should be committed to equities. Until June, there had been no technical evidence whatsoever that such might be the case. At that point distinct technical improvement did manifest itself. The Dow-Jones Industrials bottomed three times in late June and early July at around the i8t6d2 i lde,v-eplr eivnitor au-sdraayl,l ya'npde atKh es souf bMs eaqyuaenndt rebound was technically June and penetrating the impressive, surpassing, as downtrend channel in -effe-c-t–I- since the early part of the year. More impressive, as we suggested last week, was the distinct shift in leadership away from the relatively exploited growth favorites and toward that group of neglected issues which, with good reason in some case and with less apparent reason in others, had plummeted during the market decline in the first six months of 1973. Even in the light of this evidence, however, we have remained reticent about recommending the commitment of reserves. One reason has been that a whole host of indicators which have been useful in pointing out major bottoms in the past reached levels in June which were almost—but not quite—suggestive of those characteristically present at an important low. For example, the short interest ratio reached 1.65 whereas levels of 1. 9 to 2.0 had been characteristic of major lows in the past. Mutual fund cash position attained the 8.5 level, a relatively high figure, but below the peaks of 9.7 attained at the 1966 low and 11.8 reached in the summer of 1970. Specialist short sales for the week ended July 6 declined to just under 40 of total short sales but, again, lower figures had been seen at both the 1966 and 1970 bottoms. And odd-lot short sales likewise failed, by a number of measurements to reach levels to which they had risen at previous major lows. Thus, unlike, for example, May 1970, it was impossible to say in mid-June that the level of pessimism usually associated with major bear-market lows had been reached. It thus became incumbent upon us to suggest that more evidence .wasprobably .. needed, and the process of providing su'ch evidence was aborted by this week's decline. This is not to say that the evidence will not ultimately be provided. Were the pres ent downswing to test the support which now exists at the 890-860 level and should basing action or a new rally attempt assert itself from that level, we would be duly impressed. On the other hand a decisive move through that support—an event historically not without precedent—would underscore the fact that the policy of reticence was an advisable one. Dow-Jones Industrial (1200 p.m.) 906.16 S & P Compo (1200 p.m.) 106.32 AWTrk ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL No statement or eXpreSSion of opinion or any other motter herem contolned IS, or IS to be deemed to be, directly or indirectly, on oHer or the sollCltotlon of on offer 10 buy or sell any security referred 10 or mentioned The moiler .s presented merely for the COnvefllence of the subSCriber While -Ne believe the sources of our Information to be reliable, we In no way represent or gumantee the accuracy thereof nor of the statements mude herein Any action 10 be to en by Ihe subSCriber should be based on hiS own investigation and information Janney Montgomery SCali, Inc, as a corporation, and lis oiflcers or employees, may now have, or may 10ler lake, positions or trades In respect to any seuntles mentioned In thiS or any future Issue, and such pOSition may be different from any views now or hereafter expressed In thiS or any other Issue Janney Montgomery Scali, Inc, which IS registered With the SEC as on Investmenl adlsor, may give adVice to Its Investment adVisory and othe! customers Independently of any statements mode In thiS or In any other Issue Further Information on any security mentioned herein IS avollable on request

TABELL'S MARKET LETTER I l 909 STATE ROAD. PRINCETON, NEW .JERSEY 08540 DIVISION OF MEMBER NEW YORK STOCK EXCHANoe, INC MEMBER AMERICAN STOCK ExCHANGE August 10, 1973 Retracement of the June-July advance continued last week with the Dow reaching an intra-day low of 89379 6onThursday;-AsWesuggested–a'week'ago';-a -test-of–the 890-860-level appearsoprobable.,.- and whether such a test will ultimately prove successful is at best problematical. While the general market picture remains unclear however, certain distinct patterns begin to emerge from a close scrutiny of indi- vidual stock patterns,and some of them are of considerably more than passing interest. Consider for a moment the following statistics, purely technical, on a group of eight well-known companies. 200-Day High of Estimated 52 Week Moving This of 200-Day 1973 High Average Week High M/A Earnings PiE Alum. Co. of Amer. 693/4 Alan Aluminum 34 55.37 26.00 693/4 100.0 34 100.0 126 131 5.00 2.30 13.9 14.8 Allied Chern. 367/8 Montsanto Co. 597/8 32.09 52.27 363/4 581/4 99.6 97.3 115 111 3.10 5.75 11.9 10.1 Internat'l Paper 433/8 37.78 401/2 93.4 107 3.00 13.5 Westvaco Corp. 28 24.58 27 7/8 99.5 113 2.75 10.1 KennecottCopper 307/8 25.47 307/8 100.0 121 3.70 8.3 Phelps Dodge 471/2 41.94 46 96.8 110 5.00 9.2 As can be seen from the above, the eight issues show a common pattern in that they are all at or near 52-week highs, and that they are all trading,by a goodly percentage, above their 200-day moving average. Now these are simple measurements designed to measure the vigor of a given move and how close a stock is to the peak of that move. They do suggest, however, that the eight companies are in reasonably robust technical health. Furthermore, detailed ins pection of the individual patterns shows that all eight have broken out or close to breaking out of large and significant base formations. I-'-Ti1ffilngqO'Iunaanrentals. -anotlier common tl'U'l!lrdDegifiStll-emerge.- -TIm-ltst1naludBtwo-companies each from the aluminum, chemical, copper and paper industries. Producers of heavy industrial commodi- ties, the sort of issues totally out of recent vogue in investment circles, the industries involved have been subjectto varying degrees of profit-margin pressure over the years and their earnings growth, at least until recently, has generally been subpar. What then, is the improved technical performance trying to tell us GNP Deflator Annual Change Consumer Price Index Annual Change Wholesale Price Index Annual Change Dec. 1959 Dec. 1964 Sept. 1972 June 1973 102.1 109.6 146.4 152.3 3.6 3.6 5.3 88.0 93.6 127.3 132.4 1.3 4.0 5.3 94.3 94.9 120.2 136.7 0.1 3.0 18.2 Herewith another set of statistics. The above table shows the history of three measures of inflation- ary pressures since 1959, the GNP deflator, the consumer price index, and the wholesale price index. For selected periods, the annual rate of percentage change is shown. As the table shows, in the early 1960's with a low rate of general inflation, the wholesale price index increased little at all. And although the rate of increase accelerated between 1964 and 1972, the wholesale index was increasing over the period nowhere nearly as fast as the consumer price index or as the general price level, as measured by the deflator. For the past nine months however, the wholesale price index has increased at an astounding annual rate of 18.2, considerably faster than either of the other two indicators. QUite clearly, the inflationary pressures in recent months have come from an area entirely different from the service industry seemsheavily weighted in the C.P.I. ..,- It 10000iiltorpecuiatethat thlsmay welrbe-the khidiif,mvironment ihiChprodrs of industrial commodities could fare well, especially since many of them are now operating at close to capa- City, and there are some real questions about the profitability of adding substantial capacity at current price levels. This of course, can mean shortages (viz. beef and gasoline). It can also mean relief from the pressures on margins that have plagued these companies for many years. Lastly, as the final columns of the first table above show, present prices hardly involve the payment of a premium for these prospects. Most issues, even based on their recent highs, are selling at modest multiples of expected 1973 earnings. If, as is possible, these earnings represent not expansion peaks but the start of new growth trends, the investment results could be attractive indeed. NOTE The above comments are based on technical factors. Further information on all companies is available on request. Dow-Jones Industrials (1200 p.m.) 894.42 S & P Compo (1200 p.m.) 104.99 AWTrk ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL No statement or elCpreS510n of opinion or any other molter herem contorned IS, or IS 10 be deemed 10 be, directly or rnd,rec1ly, on offer or the SOII(llollon of on offer to bvy or sell cny security referred 10 or menhoned The matter IS presented merely for the conVel'lence of the subscriber While 'Ie believe the sources of our information to be reliable, we In no way represent or guarantee the accuracy thereof nor of the statements mude herein Any action to be token by the subSCriber hould be based on hiS own Inveshgollon and information Janney Mentgomery SCali, Inc, as a corporotlon, and ,ts officers or employees, may now have, or may later toke, POSitions or Irades In respect to any securities menhoned In thiS or any future Issue, ond such pos,lion may be dofferen! from any views now or hereafter e1pressed In thiS or any other Issue Janney Montgomery Scott, tnc , which IS reg,stered With the SEC os on Investment adVisor, may g,ve adVice to Its Investment adVisory and othel customers Independently of any statements mode In Ih,s or In ony other ,ssue Further Information on any securoty mentioned her!!ln IS ovailable on request

TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON. NEW JERSEY 08540 DIVISION OF MEMBER NEW VOAI( STOCK EXCHANGE, INC MEMBER AMERICAN STOCK EXCHANGE August 24, 1973 ConSidering the market's sharp short-term oversold condition, Thursday and Friday morning's rally was hardly unsurprising. Certainly more evidence will be needed before projecting a change – -in th-e malor tiend;'and-a certain-amount-of r-tsk'appears'to-remain-presentin-equitypr-ices, the. crucial question being how much. We have been recently noting in this space the fact that the average stock has, of late, for the first time in almost five years, been acting better than the averages and that we expect this to continue to be the case over the near term, regardless of the market's direction. We have recently conducted a study in which we were attempting to ascertain the maximum possible downside risk in the Dow by calculating individual downside targets for the 30 components. A summary of the technical downside objectives is contained in the following table which gives a recent price, a possible downside target and percentage decline for each stock from current levels if this downside target was to be attained. Recent Stock Price Allied Chemical 32 Alcoa 68 American Brands 36 American Can 27 Amer. TeL & TeL 47 Anaconda 20 Bethlehem Steel 25 Chrysler 23 du Pont 154 – – ar;'akc130 Esmark Exxon General Electric General Foods General Motors 21 88 60 23 62 Downside Target 30 57 30 22 44 18 24 22 105 8'5- 19 68 42 14 48 Percent Change -6 -16 -17 -19 -6 -10 -4 -4 -32 ';34 -10 -22 -30 -39 -23 Stock Goodyear Tire IntI. Harvester Intl. Nickel IntI. Paper Johns Manville Owens Illinois Procter & Gamble Sears Std. Oil of Calif. – Texaco- — Union Carbide United Aircraft U. S. Steel Westinghouse Woolworth Recent Price 20 32 31 40 19 32 96 94 62 29 33 26 28 34 20 Downside Percent Target Change 16 -20 29 -10 26 -16 36 -10 16 -16 30 – 6 58 -40 72 -23 52 -16 .20 –31– 30 -10 20 -23 25 -11 30 -12 18 -10 To get the unpleasant news out of the way first, if all of the targets suggested in the above table were reached simultaneously, the average would be 665.86. We shall be quick to state, however, that we do not offer this as a forecast, and indeed, it should be surrounded by a number of caveats including the usual one that the downside objectives are based on technical factors only and, as always, further information on the securities involved is available upon request. First of all, we have conducted studies in this nature in past downswings and have found that they invariably tend to overstate the downside risk, largely due to the fact that all lows do not tend to be reached on the sa me day. This overstatement is generally on the magnitude of 10 which would yield a possible worst-case downside target somewhere in the low 700's. Secondly, due to the statistical ironies of the Dow, the great bulk of the components have a lesser percentage vulnerability than the average itself. A decline to 653 would be a 23 decline from current levels,but the average percentage vulnerability for the 30 stocks is only 16. Indeed, 11 of the components suggested a downside risk of 10 or less and 19 of the 30, risk of less than 20. The large potential risk appears to be present in higher priced stocks, and it is these stocks, — as we and others have suggested, which carry the highest weight in the Dow- – Further it should be noted that in compiling the study we have tried to use the most peSSimistic possible objectives and furthermore we assumed downside breakouts for a great many stocks although these breakouts have not yet, in fact, taken place. Quite obviously, were these downside penetrations not to eventuate, the ultimate risk for the averages would be greatly reduced. We do not, therefore, as we stated above, intend this study as a forecast, but rather as a measure of the maximum downside vulnerability under the worst possible technical conditions. Its main purpose is to underscore our basic thesis that the risk at this moment in large numbers of individual issues appears to be a great deal less than some of the widelv followed indices might suggest. Dow-Jones Industrials (1200 p.m.) 867.40 ANTHONY W. TABELL S & P Compo (1200 p.m.)101.85 DELAFIELD, HARVEY, TABELL AWTrk No statement or expreulon of opinion or any other motter herein contamed IS, or IS 10 be deemed to be, d'redly or mdnedly, on offer or the sollcllollon of on offer to buy or sell any securrty referred 10 or mentioned The matter IS presented merely for the converlence of the subscriber Whde we believe the sources of our information to be reliable, we In no way represent or guarantee the accurOl;y thereof nor of the statements mude herein Any acl10n to be taken by the subscriber should be based on hiS own investigation and Information Janney Montgomery Scott, Inc, as a corporatIon, and Its offIcers or employees, may now have, or may loter lake, poSitIons or trades In respect to any securities menhoned In this or any future Issue, and such POSItIon moy be dIfferent from ony VIews now or hereafter e)'pressed In this or any otner Issue Janney Montgomery Scott, Inc, whIch IS registered With the SEC as an Investment advisor, may give advIce to Its Investment adVisory and other customers Independently of any statements mode In thiS or In any other Issue Further InformatIOn on any security mentioned herem IS ovarloble on request

') /' f I—–AaELL.s JlMARKET LETTER l -. ——- 909 STATE ROAD, PRINCETON, NEW JERSEY 08!540 DIVISION OF MEMBER NEW YORK STOCK EXCHANGE. INC. MEMBER AMERICAN STOCK EXCHANGE August 31, 1973 Something 1S happening. Of that there can be little doubt. The current stock market presents a picture changed quite dramatically from the dreary one which existed last Spring as most indicators plunged to-new .lows 'with 'sickening regular-ity. Yet l;eJore we become .unduly excited about this. -. change, it is possibly best to try to quantify it—to see, in other words, in just what ways the present market is different from that of early 1973 and in what ways it remains unaltered. In terms of the Dow-Jones Industrial Average the market decline from January's closing high of 1051. 70 to the closing low of 851. 90 just a week ago can be broken down into no fewer than nine distinct phases. These phases consist of declines ranging from just under 4 to just over 9 w1th an average percentage decline of 6.1 . With one exception each decline produced a new low lower than that of the prevlOUS one. The length of each decline in terms of trading days ranges from five through 19 days with the average length being 11 days. Each drop in turn was followed by a rally. With a Single exception, the 23-day advance of July-August, these rallies all lasted between three and six days and involved percentage advances of between 3 and 5. The point of this statistical passion play is to point out that market action in August so far fits squarely into this context. The 18-day, 9 decline which characterized the early part of August was nothing more than a repetition of the sort of declining phase we have been seeing all year, and the 3.7, five-day advance to Wednesday was, so far, just like any of the other rallying phases which have temporarily interrupted the downswing. The details are shown in the table below. Drop From Date DIIA Last High January II, 1973 1051. 70 February 8, 1973 967.19 -8.0 feoruar,,-277-T973'-' -'947 92—-4-. 9– March 23, 1973 922.71 -5.8 April 5, 1973 923.46 -3.7 May I, 1973 921.21 -4.8 May21,1973 886.51 -7.3 June 4, 1973 885.91 -4.8 June 25, 1973 869.13 -6.2 August 22, 1973 851. 90 -9.1 Number of Advance Days Decline Next Rally 19 3.1 – 9 …………—-T-4 12 3.9 5 4.8 13 3.8 9 5.0 5 4.6 9 7.8 18 3.7 No. Days Next Rally New Lows 3 6 — . 4 13 5 4 6 23 5 173 2'07— 455 293 263 858 336 294 140 And yet, as we said, there is a difference and the difference can be summarized in the right- hand column which shows the number of new lows chalked up on each declining phase. As can be seen this number had been gradually rising through the decline of May 25. Yet though the averages have subsequently moved on to three successively lower bottoms, the number of individual issues making new lows has been slowly drying up. Now this is nothing more than a statistical demon- stration of a phenomenon we have been pointing to for some time—the fact that the average stock is finally beginning to act better than averages. The declining number of new lows suggests simply, that significant numbers of issues, battered in the decline so far, have attained downside objectives and are beginning base formations—all this despite the fact that evidence suggesting that a low In the averages has been reached iS,to uS,still tenuous at best. Bear markets throughout history have shown significant similarities and equally significant differences. In the last major bear market, that of 1968-1970, the general market bottom was 1–0 …,..,.-.eminently,recognizable,within a short time after .its occurrence.–.The task-of identifying upside. – – – I leadership for the next bull market was a good deal more difficult, and it was difficult to identify that leadership with any certainty until the market moved ahead from its May lows to completion of the base in October. Such is not always the case, however. In the decline of 1957, for example, many issues proved resistant to the decline, remained just above substantial base formations, and were easy to identify as potential leadersh1p even while the market was plunging to new lows. We suspect that a similar situation exists today. The outstanding relative action shown by the cyclical, commodity-type companies which will be the beneficianes of upward price pres sures constitutes a technical signal too strong to be ignored. We feel quite strongly that it is these companies that will provide upside fuel for the next advance, whenever and from whatever low that advance may take place. Dow-Jones Industrials (1200 p.m.) 881. 70 S & P Compo (1200 p.m.) 103.83 AWTrk ANTHONY W. T ABELL DELAFIELD, HARVEY, TAB ELL No stotement or expression of opinion or any other matter here, tontomed IS, or n to be deemed to be. directly or indirectly, on offer or Ihe sollC-llohon of on offer to buy or sell any secunty referred to or menlloned The moller n presented merely for the conver'lenct of Ihe subscrIber. WhIte e believe Ihe sources of our Informo tlon 10 be relloble, we ,n no woy represenl or guorontee the accurocy thereof nor of the statements m\.lde hereIn Any octlon to be laken by the subscriber should be based on h,s own InvestIgatIon ond Informahon. Janney Monlgomery Scoll, Inc, os a corporatIon, ond Its offIcers or employees, may now have, or may loter take, poSItIons or trodes in respect to ony secuntles mentioned In Ih,s or Clny future Issue, ond such POSition moy be dIfferent from any vIews now or hereofter expressed In Ih,s or any other Issue Janney Montgomery Scolt, Inc, whIch IS registered With Ihe SEC 0 on Investment adVIsor, may give adVIce to Its Investment adv,O'y and olhel customers Independently of ony statements mode In Ihls or In ony ether Issue Further Informotlon on ony security mentIoned herein IS ovailable on request

, – – – – – – – – – – – ——- p-. – — …-.- TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON, NEW JERSEY 08540 DIVISION OF MEMBER NEW YORK STOCK E)(C'ANGE, INC MEMBER AMERICAN STOCK EXCHANGE September 7, 1973 . Market ,actiolLcontinues to improve in subtle ways, although not in a convincing enough stfaroion-to s ugges'f tl1i'lt the' dowi-iswing; i -tITnS Of'the populaaverages-at lea ,''is'aefinitely; — over. This week's rally brought the Dow-Jones Industrial Average back through the 900 level on the upside, the fifth time this year such a penetration had occurred after the Dow had previously traded below 900. Perhaps the most impressive action of the week was that of the Dow UtIlities which, on Thursday, posted a whopping 2.6 advance, a fairly astonishing jump for a normally non-volatil index. Breadth figures have also been impressive, with 800 or more Issues having advanced for the last six successive days. Essentially, however, the market dilemma remains the same. The normal signs of a major market bottom failed to manifest themselves in May-June prior to the time market action began to improve. Thus if an effective bottom occurred last summer it is going to be recognizable only somewhat after the fact,and this recognition process will require time. It is, after all, only 11 trading days since the last low in the major Indices was posted, and any advance is going to have to develop more staying power than the present one has had a chance to show before a definite turn can be foreseen. We have been repeatedly pointing out that the major change in the market picture over the past three months centers around the fact that, while In thE first half of the year the popular averages had been understating the extent of the market decline, since June they have been – ''.rrrd-ersta tingits -strengthA recent-s tudy-of-th e-a ction-o-;ndiviooalstee ksbear-sGut- th i s thesis,which has also been suggested by the action of our cumulative index. For the first six months of 1973 the Dow declined 11.5 while our unweighted cumulative index declined 30.8. Looking at the action of all 2853 common issues listed on the New York and America n Stock Exchanges corroborates the story told by the unweighted index. Over the first six months only 554 issues acted better than the Dow and 2309 acted worse. Thus the chances of picking an indiVidual stock that was gOing to outperform the Dow were less than one in five. Over the six-month period only 253 issues actually advanced, on average only one issue in 11. By contrast the 30.8 decline shown by the cumulative index proved to be just about the median performance. 1480 issues acted better than this for the first six months, and 1373 did worse. Since June the picture has reversed, and again the cumulative index is apparently telling the true story. For the period June 29 – September 5, the Dow is almost unchanged, having advanced a miniscule 0.8. while the cumulative index has posted a 3.5 gain. 1649 issues, or 57 of the total. have posted better performances than the Dow, and the fact that it is possible to find striking investment performance is underscored by the fact that 595 Issues have advanced 20 or more in those two months. The cumulative index's 3.5 advance again prQves to be PLetty close to the median p.erforma, ,For..!!'e period j\Jst1449 ,.;a.;..v;;,e bettered-this rise and 1404 have risen less or deciined-.- As-we have-said before this,S the -,.. – -,.sort of action we expect to continue, regardless of the performance of the average. NOTE In view of the disparity between our unweighted cumulative index and ,weighted indices we are starting this week the practice of showing the Thursday close of the cumulative index in the lower left-hand corner of this letter along with the Dow and S & P Composite. Dow-Jones Industrials (1200 p.m.) 897.80 S & P Compo (1200 p.m.) 104.93 Cumulative Index (9/6/73) 688.59 AWTrk ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL No Iolemenl Of expression of opinion or any other motler here'n C)ntOlned IS, or IS 10 be deemed to be directly or mdlfedly an offer or the soliCitation of an offer to buy or sell any eCl.JfJly referred 10 or mentioned The mOiler IS presented merely for the converlCnce of the subscnber Whll we believe the sources of our information 10 be reliable, we In no way represent or guarantee Ihe aCCl.Jracy thereof nor of the stotemen's mude herein Any adlOn to be lalen by the subscriber should be based on hiS own Investigation and information J(mney Montgomery Scott, Inc., os a corporotlon, ond Its offICers or employees, may now hove, or moy later loke, po,ltlons or trades In respect to ony Cl.Jfltle5 mentioned In Ihls or ony future Issue, and such position may be different from ony VieNS now or hereafter e,.pressed In thiS or any other Issue Jonney Montgomery Scolt, Inc, which IS registered With the SEC as on Investment adVisor, may give odvlCe to Its Investment adVISOry ond olhe! customers Independently of ony slotl;!menls mode If1 Ihls or ' ony other Issue Further ,formation On any security mentioned herein 1 available on request.

– ! TABELL'S , , MARKET LETTER – I — i 909 STATE ROAD, PRINCETON, NEW JERSEY 08540 DIVISION OF MEMBER New VORK STOCK EXCHANG, INC MEMBER AMERICAN STOCK eXCHANGE September 14, 1973 –In March and April of this 'year we devotedno-fewer than-four-of-these,letters -to a phenomenon; which we did not then name but which has since come to be called the two-tier market. We make no claim to have been the first to draw attention to its existence, but subsequent events have proved that we were certainly not the last. It has indeed been practically impossible to pick up a financial publication of late—including such widely circulated and prestigious ones as Fortune and the Wall Street Journal—without being subjected to copious elucidations of the problems presented by the price disparities between institutional growth favorites and the rest of the market. The number of words which have seen print on the subject may well be approaching the dollar market value of IBM held by the ten largest bank trust departments. Out of all this welter of words there has come a consensus that the two-tier disparity must in some way be resolved over the fairly short term and a like, although less widely held, consensus that this resolution may take the form of a severe price lambasting of the formerly favored growth issues. Toward this consensus there are three possible attitudes. The first course, one which has often proved profitable in the past, is to adopt a so-called contrary opinion. This would, in effect, say that, since everybody seems to be taking out after the first tier, that the majority is probably wrong and that these issues provide attractive investment vehicles at today's prices. The trouble with this is that contrary opinion has generally proved ' most useful in leading to the purchase of securities which nobody else wanted, and which were cavailaJ5le'afDa;galn Pi'lces–Itlsdfff1culno sugge-st an ansence–o(CiemancCforittocJ(swhich are- ' accorded four times the earnings multiple of the Dow-Jones Industrial Average. A second alternative is to suggest that the proponents of gloom and doom for the growth stocks may well be wrong, and that they will rest while the rest of the market catches up with them. And the third option, of course, is to go along with the majority and suggest that many growth issues may see lower and indeed, perhaps substantially lower,prices. Now all of this is a fascinating topic for the extensive philosophical discussion which it has already engendered, but it seems to us that, for the individual investor (as contrasted with the trust department owning a billion dollars worth of hamburger stands), there is very little problem. We have always felt that undue importance in investing is attached to decisions to buy and sell, whereas the real decision to be made with regard to an individual issue is whether to hold or not to hold—buying and selling being only the means by which the investor gets to one of the aforementioned positions. Our suggestion for the individual, in other words, is that, during the period that the two-tier difficulties are being resolved, it is preferable to allow someone else to own the first tier stocks. Now this attitude, we are ready to admit, is complicated by the existence of the capital-gains tax. The sale of many.growth lavorites will in,olve, ,unfort';lnately,.the,paying of an immed-iate forfeit to theU SGovernm'ent. Yet, while admitting that tax factors cannot be ignored, we feel compelled to suggest that they be weighed against considerations of preservation of capital and alternative capital-gains opportunities. We do not, in sum, believe we have sufficient prescience to forecast exactly what form the two-tier resolution will take, and we suspect that it will be complex and not clear-cut. In battles between titans it is best to stay out of the ring. That option, at least, is available to many investors. Dow-Jones Industrials (1200 p.m.) 878.76 S & P Compo (1200 p.m.) 103.24 ANTHONY W. TAB ELL DELAFIELD, HARVEY, TABELL Cumulative Index (9/13/73) 683.01 AWT rk No stalement or expreSSion of opInion or any other motler herem contolned IS, or IS to be deemed 10 be, dlrec1ly or indirectly, on offer or the 50lle.IOllon of on offer to buy or seU any secvrlty referred 10 or mentioned The mOiler IS presented merely for the conve((ence of the subscriber While oNe believe the sources of our Informa- hon to be reliable, we In no way represent or guarontee the accuracy thereof nor of the stotements mude herein Any aclion to be token by the subSCriber should be based on hiS own Investlgallon and Information Janney Montgomery Seoll. Inc, as a corporallon, and Its officers or employees, may now have, or may later take, poSitions or trades In respect to any securlhcs mentIOned In thiS or any future Issue, and such pOSition may be different from any views now or hereafter expressed In thIS or any other ISsue Janney Montgomery Scoff, Inc, which IS registered With the SEC as on Investment adVisor, may give adVice to lIs Investment adVISOry and othel customers Independently of any statements mode In thiS or In any other Issue Further InformatIOn an any seeurlly mentioned herein IS available on request