TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON NEW JERSEY 08540 DIVISION OF MEMBER NEW VORK STOCK EXCHANGE, INC MEM8ER AMERICAN STOCK eXCHANGE September 5, 1975 – Recent.market a;!!n.alleit that.it took pla.ce on.lightyolume, has been admittedly.im- ; …pressive. As our readers are aware. e have bee-opJating on the the;;Y that-'one f;;tlter -ex;- — sion of the intermediate-term downswing from the July highs was a possibility, although we have noted that we did not expect-prices to move all that much lower. Continuation of the recent strength, if it occurs, may require revision of that forecast. The recent behaVior of the market has, indeed, been that which one would expect in a period of reaccumulation. The recent rally high has just about equalled the highs of late July and early August, just under the 840 level on the Dow, and recent trading has featured wide swings back and forth between 820 and 840, also what One would expect if reaccumulation were taking place. Leadership, moreover, ha s come from a logical area, the cyclica I, heavy-industry stocks whose long-term patterns are conducive to an advance. A continuation of this sort of action followed by a decisive breakout above the 840 level would tend to suggest another attack on last summer's highs, at which pOint we would be facing another fairly crucial juncture. None of this, however, has yet taken place, and there is another factor, admittedly not conclusive, arguing in favor of lower prices. We stumbled on that factor purely by chance. As our readers know, we have studied extensively the phenomenon of the year-end rally and have convinced ourselves that the tendency in favor of such a rally is statistically significant. In recent years we have extended this study of seasonal patterns to one of Wall Street's favorite myths ,the.socalled,summer.rally ,.and,iLwl11.br-,yall L.ha\leexprel'.s,!cI.certa in doubts. as. to whether a rally in July and August constitutes a real seasoal paitern. it is interesting to note, – – incidentally, that the summer rally proved to be a myth this year. Although August was marginally an up month, the Dow closed sharply lower in July, and, over the two-month period, declined from 878.99 to 835.34. In any case a b-product of the summer-rally studies was the discovery of still another seasonal pattern which we found to be significant — the tendency toward a decline in the month of September. In the 49 years beginning with September, 1926 through 1974, the Dow advanced 21 times in September and declined 28 times, and the 49 years have shown an average percentage decline on the month of 1.36-, September being the only month which shows an average decline of greater than 1. Now, the reader may well ask whether this has any real meaning at all. The answer is that it very possibly does. Of the 588 months in the 49-year period, 338 showed advances and 250 showed declines. Standard statistical tests can be applied to give us the probability of finding, a group of 21 advances and 28 declines in such a population on a purely random basis. The chance of doing so is well under 5, thus suggesting that there may well be, indeed, some validity to the September phenomenon. If we examine the September record more closely, it is rather interesting. The month ha s produced declines of 30 and 13 back in the 1930's, and the biggest advance it has ever pro,..-ducedis-13,–also in the,1930's. In the postwaL-period,.,the largest advance has,been 6. 71 .. in 1973, and the largest decline just last year, one of 10.42. It is also interesting to separate the 49 Septembers into periods identifiable by hindsight as bull and bear markets. 33 Septembers have fallen withm bull-market periods, and, although, by defmition, m such a period there is a strong tendency for the market to be up, the score is just about even, with 18 advances and 15 declines. In the 16 years identifiable as bear-market years, there have been only three advancing Septembers and 13 declines. As we noted above, there is always some chance that a record like the foregoing is a purely random phenomenon. Nonetheless, we think the pattern interesting. Dow-Jones Industrials (1200 p.m.) 835.89 ANTHONYW. TABELL S & P Compo (1200 p.m.) 85.72 DELAFIELD, HARVEY, TABELL Cumulative Index (9/4/75) 488.70 AWT/jb No statement or expression of opinion or ony other motter herein contOlned IS or IS to be deemed 10 be, directly or mdlrectly, on offer or the SOI'Cllollon of on offer 10 buy or sell cmy secunty referred 10 or mentioned The mOiler IS presented merely for the converlenct of the subscriber Whlle.,.,e believe the sources of our Informa tlon to be reliable, we In no way represent or guarantee the accuracy thereof nor at the stOlements mude herein Any aellan to be taken by the subSCrIber shOUld be based an hiS own Investigation and Information Janney Montgomery Scot!, Inc, as 0 corporation, and Its officers or employees, may now have, or may later tae, positions ar trades In respect to any seCUrities mentioned In thiS or any future Issue, and such posilion may be different from any VieNS now or hereafter expressed In thiS ar any other Issue Janney Montgomery Scoll, Inc, which IS registered With the SEC as an Investment adVisor, may give adVice to Its Investment adVisory and othel customers Independently of any statements made In thiS or In any other Issue Further mformotlon on any security mentioned herein IS aVailable on request

TABELL'S MARKET LETTER 909 STATE ROA.D PRINCETON, NEW JERSEY 08540 DIVISION OF MEMBER NEW YORK STOCK eXCHANGe, INC MEMBER AMERICAN STOCK eXCHANGe September 12, 1975 -,,. –. -,-,-v..re.,,!()eUn.thisd'2..ageast w1.thattDe 840ehon.!l!po.;JoEes Ind,,tr1a . . … Average would be crucial if the market were to reverse its downside momentum and turn upward in another attempt at the July highs. An attempt at breaching that level was mounted on Monday and Tuesday of this week as the Dow closed on Monday at 840.11 and displayed further strength in trading early Tuesday morning, actually reaching an intraday high of 849.03 on that date. The rally attempt then turned into a rout as the market gave up all of its gains and finally wound up posting a 12-point loss. Additional losses were tacked on on Wednesday as an intraday low of 809.53 was reached, but a rally in the last hour limited the decline to a 10-point loss. Weakness continued on Thursday as another five points were given up. As readers will be aware, we have been expressing some skepticism as regards market strength over the past two weeks and indeed were somewhat surprised that the rally carried as far as it did. Actually, if one removed his attention from the Dow-Jones Industrial Average, the rally never really was all that impressive. At certain points in time, more so then at other pOints, the Dow becomes a particularly distorted mirror of market activity. The present con- stitutes just such an instance. From its July high to its August low, for example, the Dow dropped 10.2. In reality, however, the decline was a great deal more severe than this would suggest. The Standard and Poors 500, over the same period, dropped 13.1 , and our Cumula- tive Index, measuring the action of all stocks on the NYSE, declined 15 8. The Dow also distorted the subsequent rally. It moved up 6.1 , retracing 54 of the ground lost. The . – – -,.. S -&. P.5 00. andourC.umula.ti v.e.lnd ex.,bycontras.t.,-mov.ed.uponly3 4.a nd. 4…6..r.e s pectiv.elY,1 in each case retracing less than a quarter of the ground given up on the previous rally. The reason for the aberration of the Dow at this time is quite simple. Liberally sprinkled among its components are issues in the steel, paper, container, chemical and auto groups, which have, to date, proved highly resistant to the decline and many of which were among the tiny minority of issues appearing on the new-high list over the two weeks of the advance. As we noted in last week's letter, this phenomenon has both favorable and unfavorable implications. On the favorable side, the above-average relative action shown by these issues may well imply that they will be able to hold above their spring lows and extend their long-term advance once the present correctionary phase is over. Were this to be the case, the downside target on the Dow would probably be limited. On the other hand, the fact that the strength to date has been limited to a tiny handful of issues suggests that any rally attempt from these levels would be too narrow to be sustained and that the vast bulk of stocks must retreat to an area of greater demand before a broad rally can be predicted. At any given point in time, it is helpful to have both a forecast and an igea of the sort of market action it would take to cause revision of that forecast. As far as the forecast is concerned, we continue to hold the view previously expressed that the August low on the Dow will be penetrated, with possible downside objectives in the 740-725 range. The logi- cal timing of such a low would be some time in September-October which, as we discussed last week, seasonal factors suggest is a logical time for a bottom. The above forecast would, probably haveto be reVised-bullishly were the market-to demonstrate ,for a-second- time, ability to find demand at the 790 level, which effectively halted the downswing last month. Further baSing out at that level could make a broader rally in the fall a stronger possibility. On the other hand were the cyclical issues, which have provided market leadership to date, to turn down and post the sort of intermediate downswing on which the bulk of the market has already embarked, the drop could turn out to be something more serious than that projected above. Dow-Jones Industrials (1200 p.m.) 819.15 S & P Compo (1200 p. m.) 83.81 Cumulative Index (9/11/75) 474.43 ANTHONY W. TAB ELL DELAFIELD, HARVEY, TA8ELL AWT/jt No 1-'ctement or eyprCnlOn of opinion or ony other moiler herein contamed ,. or IS to be deemed to be, directly or Indirectly, on offer or the sollcllol,on of on offer 10 buy or sell any secunty referred 10 or mentioned The matter IS presented merely for the convertlenC6 of the subcrlber Whde we believe the sources of our Informahon to be reliable, we In no way represent or guarantee the accuracy thereof nor of the 5.tatements mude herein Any achon to be taken by the !ubscnber should be based on his own investigation and information Janney Montgomery Scali, Inc, as a corporation, ond Ill. offuers or employees, may now have, or may later toke, poSitions or trades In respect to any secUrities mentioned In thiS or any future ISsue, and such poslon may be different from any views now or hereafter expressed In thiS or any other Issue Janney Montgomery ScoH, Inc, which IS registered With the SEC as an Investment adVisor, may give adVice to 11 InVestment adVISOry and othel customers 1I1dependently of any statements mode 111 thiS or In any other Issue Further Informal Ion on any security menhoned herem IS available on request

TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON, NEW JERSEY 08540 DIVISION OF' MEMBER NEW YORI( STOCK EXCHANGE, INC MEMBER AMERICAN STOCK eXCHANGE September 19, 1975 On New York City — There is some link, we think, between Gotham's financial troubles and the stock market, even if it is only the tenueus ene that the chaes New Yerk has brought to the municipal bond market enhances that market's stature as a competitor with equities for investment funds. Insofar as the problem itself is concerned, we confess ourselves unable to see any permanent selution and doubt that the current policy ef staving eff crises in the hepe of miracles can be permanently successful. Dr. Milton Friedman, a man knewn fer his willingness to call spades spades, has suggested bankruptcy as the only solution on the theory that this step would deny the city access to. the credit markets and thus force it to live within its means. We have grave doubts as to whether such a step could ever be brought about by a purely political process. That process in New York City has long been the victim of a malaise in which the individual voter tends to perceive himself as the recipient of a particular form of city largesse –either as a municipal werker, a subway rider, a dweller in a rent-controlled apartment, a tuitionfree student er a welfare recipient — rather than as a member ef a citizenry who must share the burden of all such forms of largesse. As long as this attitude continues, it is hard to see how bankruptcy can be avoided. As noted above, a sidelight to this crisis has been indiscriminately lower prices for most tax-exempt bonds, and the key werd here, we think, is indiscriminately. There are many bonds of many issuers which retain impeccable investment qualities and it verges, in eur view, I on-irratienal1ty'1hat qua lity'lS's u'e-sShoutd'heClffectetl(rstlrey-hc-vebY-NeWYorkG1tV'Strouble's. .- Security analysis is as applicable for bend markets as for steck markets and, with the current depressed state ef municipal bend prices, it sheuld be deveting itself to separating the wheat from the chaff. -! On the prime rate — That there are and have long been certain relationships between the course of interest rates and the ceurse of steck prices is a fact of which technicians have been aware for many years. The development of an almost Pavlovian res pense to prime-rate chaIl;jes by the equity market is, however, a comparatively recent development. Thus, the market plummeted in 1974 as the prime rate rose and began riSing again in early 1975 on the news ef every prime rate decrease. It has lately taken to displaying nervousness as the prime rate rises again. We think it important to differentiate between 1974 and the second half of 1975. A year ago the prime rate was rising, as it will in the short run, from a contraction in the rate of monetary growth, a phenomenon which had in the past, and did again in 1974, tended to produce recessions. It is apparently rising today in the face of a botteming ef that recession and a glimmer of an increase in lean demand. Since the two situations are fundamentally different, we are less inclined at the moment to worry about the short-term effect of prime rate increases. On the barbareus relic — One ef the interesting Sidelights in the financial markets in recent.!Ilonths.has,been,a.rather sharp decline)ntheprice ef.geld.whichThursdaymey-,d.to..a. new lowtogether with concomitant' strength-in the U .S'-dollar versus al;;05t811 other foreign'- currencies. It is rather interesting, actually, to see beth geld and stock prices declining at the same time since they have, historically, tended to move in different directions, a fact which lends SOme rationale to the coincidence that gold bugs are often super bears and vice versa. To us the phenomenon at least mildly suggests that monetary markets are displaying more cenfi- dence in the U. S. economy than our own stock market is now doing and that the prespect for in- flation — at least at a rate greater than the world rate — may net be as much of a certainty as many seem to think it to be. Dew-Jones Industrials (1200 p.m.) 823.76 ANTHONY W. TABELL S & P Cemp. (1200 p.m.) 85.17 DELAFIELD, HARVEY, TAB ELL Cumulative Index (9/18/75) 469.07 AWT/Jb No statement or expression of Opinion or any other motter herein COntained IS, or IS to be deemed to be, directly or mdneclly, on offer or the sollCltotlon of on offer to buy or sell ony secvnly referred to or mentioned The motler IS presenled merely for the converlenCE of the subscriber. While lie believe the sources of our IMorma 11011 to be reliable, we In no way represent or guarantee the accuracy thereof nor of the Slalemenls mude herem. Any octlon 10 be token by the subSCriber should be based On hiS own mvesilgotlon and 'nformat,on Janney Montgomery Seart, Inc, as a corporation, and ,IS officers or employees, may now have, or may later loke, pOSitions 01 trades In respect 10 any S!X\HllleS menl10ned In thiS or any future IHue, and such position may be different from any views now or hereafter expressed In thl or any other Issue Janney Montgomery 5coll, Inc, v.hlCh IS regIstered With the SEC as on Investment adVisor, may give odvlce to lIs Investment adVisory and other customers II'ldependently of any statements made In th,s or In any ather Issue Further Information on any security mentioned herem IS available on request

TABELL'S MARKET LETTER – .e – – t., 909 STATE ROAD, PRINCETON. NEW JERSEY 08540 DIVISION OF MEMBER NEW VORK STOCK EXCHANGE, INC MEMBER AMERICAN STOCK EXCHANGE September 26, 1975 We expressed in this space two weeks ago our belief in the probability of lower prices, 'posstbly'tn-th-e74il7Q5-range-in-terms'of theDow;together-with-our'view'of-what-evidence the–market-'….–.. – would be required to provide if this forecast were to be rev,ised. At least a portion of that evidence was provided in last week's trading. We said a fortnight ago, At any gtven point in time, it is helpful to have both a forecast and an idea of the sort of market action it would take to cause revision of that forecast…. The …. forecast would probably have to be revised bullishly were the market to demonstrate, for a second time, ability to find demand at the 790 level, which effectively halted the downswing last month. Further basing out at that level could make a broader rally in the fall a stronger possibility. The market has, indeed, in the past few days, provided impressive evidence of demand at the 790 level. After attaining a closing low of 795.13 on September 16, the Dow posted a 4-point rally last Wednesday and followed that up on Thursday and Friday a week ago with two IS-point gains back-to-back, attaining a closing peak of 829.79. A fairly sharp decline followed on Monday, but a great deal of this ground was recovered in Wednesday's trading. What we are now wa iting for is for the market to drop the other shoe. The Dow has been contained in, roughly, the 790-840 range long enough now fOr that range to have some significance. Were the average, having now held twice at the 800 level, to break out sharply above 840, that rally being confirmed by decent breadth and volume, one would have to suspect that, at the very least, a reasonably good intermediate-term advance might be in the offing. Exact upside objectives will remain unclear until the base is ultimately complete, but we would suspect that the minimum upside target would be another attack on the highs of early last summer. We are not, at the moment, prepared to offer this view of the market as a forecast — there is no point in anticipating an upside breakout that has not yet taken place — but it certainly at this stage must be recognized as a rather real possibility. —I–te-restirig-te-s-t.-LEovoekninwghiahleeavdOiaCbiintgfausrtUhsePr,i-canioo-tnhoevr-eartt-acthkeopna-tshtefoelwdmh0ingthhwstohuladtpprroiv2cidees-smtiillg7hantomtohveerlionw-ei,w-e–I have continued to suggest that the decline would qualify as nothing more than an intermediate-term down- swing. Our reasoning behind this line of thought was the fact that the major signs of deterioration, which had in the past signaled major tops, were not yet present. One such sign of deterioration is a breadth divergence which had not, of course, occurred at the July high, breadth having led the Dow into new high territory . The following table shows the breadth divergence action at each of the past four major tops followed by the most recent action of our own weekly breadth index. As the table shows, in three of the four cases the divergence was provided by the Dow first posting a high, subsequently moving noticeably lower, and then posting a new high, with the breadth index failing to go to a new high. This was the case in May, 1961-February, 1962, May, 1965-January, 1966, and March, 1972-December, 1972. The action in December, 1968-May, 1969, was a bit different. Breadth moved to a new high along with the Dow in December, 1968, but the breadth decline in the first two months of 1969 was one of the most vicious on record, and breadth rallied hardly at all in the rally of February-May. Such action was clear enough to sound a distinct warning signal. FIRST HIGH SUBSEQUENT LOW NEXT HIGH Date DJII Breadth Date DJII Breadth Pts. Decline Date DJII Breadth May 1961 714 563 .oct 1961 688 548 15 Feb 1962 740 558 May 1965 944 595 Jul 1965 832 557 38 Jan 1966 1000 593 Dec 1968 995 582 Feb 1969 876 528 54 May 1969 972 533 Mar 1972 – -Jul 1975 – 984 477 Oct 1972 938 440 888- – 376 –Sep 1975 785 – 353 37 Dec 1972 23 . 1065 462 – – f- In the present instance, an attack by the Dow on its old high could set up the potential for the same kind of breadth divergence that characterized three of the four pr evious tops. The 1968-69 action is unlikely to be duplicated since the decline in breadth so far has been relatively mild, but, were the Dow to move above its July high with breadth failing to recover the 23 points it has given up on the decline, a divergence situation would be created. Still, on the other hand, were any advance from these ievels to new peaks on the Dowto be confirmed by a breadth index, we would have exactly the opposite situation,and a worthwhlle extension of the rally could be foreseen. Since we have previously noted that we would regard an upside penetration of 900 as being highly significant, the action of breadth wlll be the subject of an intense scrutiny 11 the market continues to move ahead in the next few weeks. Dow-Jones Industrials (1200 p.m.) 820.17 S & P Camp. (1200 p.m.) 86.11 ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL Cumulative Index (9/25/75) 478.47 AWT/jb No statement or expreulon of opinion or any other matter herein onlolned IS, or IS 10 be deemed to be, directly or ,nd,rectly, an offer or the soliCitation of an offer to buy or sell any security referred to or mentioned The mOiler IS presented merely for Ihe canverlenCE of Ihe subscriber While -He believe the sources of our InformaTIon 10 be reliable, we In no way represent or guarantee the accuracy thereof nor of the statements mude herein Any action to be toen by the subscnber should be based on hiS own Investlgolton and Informallan Janney Montgomery Scott, Inc, os a corporation, and .ts offICers or employees, may now have, or may later toke. poSitions or Irades 10 respect to cny seCUrities mentioned In Ihls or any future Issue, and such posilion may be different from any views now or hereafter elpressed In Ih,s or cny other Issue Janney Monlgomery Scorr, tnc , which IS registered wllh the SEC as on IOvestment adVisor, may give adVICe to .15 Investment odvlSQry ond olhel customers Independently of any stotements made In thiS or 10 any other Issue Further Information on any security mentioned herel() IS available on request