— j-' , , T , .. , – ,—,—–,- —— TABELL'S. ,! MARKET ri LETTER ,/ 909 STATE ROAD, PRINCETON NEW JERSEY 08540 DIVISION OF MEMBER NEW YOAK STOCK eXCHANGE, INC MEMBEA AMEAICAN S'tOCK EXCHANGE '.. July 25, 1975 '- –…. One measure – of-'howfar the-market4s-into'a-bul1'cydeis,the- extent to which .short— term declines tend to incite nervousness. By that standard, the amount of nervousness inspired by six straight days of decline through Wednesday, plus a generally weak market on Thursday even though the Dow closed up, suggests that the upswing is not yet in a mature stage. Nonetheless, the six days of decline did, in fact, take place and perhaps it is worthwhile to examine them and try to place them in perspective. In numerical terms, the drop amounted to 5.12 on the Dow-Jones Industrials and 5.79 on the S & P 500. It marks the third correction of slightly over 5 that has taken place since the major upswing began last December and its behavior to date, at least, is suspiciously like the others. The first such correction took place between March 17 and April 7 and amounted to 5.55 on the Dow and 6.58 on the S & P, slightly more severe than the percentage declines posted to date on the current drop. The shape of that decline consisted of five days of a fairly sharp drop, followed by a three-day rally, followed by five more days of decline to a low that was fractionally below the earlier one. Such a shape is not unusual at a short-term bottom and, indeed, might occur in the present case. The second interruption in the major advance took place between May 14 and May 29 and was slightly less severe than this one, amounting to 5.09 on the Dow and 2.8 on the S & P. This one lasted ten days in which the downward trend largely prevailed except for a two- di!Yrallyabout ha Ifway through . Thusunles stheJlresenLdeclinewor.sensit .istotallyconsls,.-,–…. – – …. – . L ' , — – – -r tent with the experience of corrections in the 1975 bull market to date. It is also worthwhile comparing the three declines in terms of breadth and of our Cumulative Index of all stocks. The first drop, that of March-April, was the only one on which our Cumulative Index performed worse than the major averages, dropping 6.56, about the same as the S & P. In the May drop, it significantly outperformed the other indices, dropping only 1. 85 and bottoming five days before the Dow and the S ; P 500. In the present instance, It has declined 5.61 to date, about equaling the major averages. About the same results are shown by the breadth index, which significantly outperformed the averages in May, dropping some 3 1/2 points. Its current performance is slightly better than in the March-April decline where it dropped 11.26 pOints versus 10.63 points currently. As we noted before, the decline could, of course, worsen, thus invalidating the above comparisons. However, for the time being, at least, we consider this less than likely. At the week's lows, both the Dow and the S & P had reached the downSide objectives of their small tops and were at fairly strong support levels, 850-820 in terms of the Dow and 95-90 in terms of the S & P which, as of Thursday, had dropped to the lower part of its support area. Were these support areas to be decisively penetrated, lower prices could, in fact, be foreseen.but there is no reason at the moment to suggest that this is likely to take place. .,. z ………… – – – ';'-t.– -' The significant story told by minor declines is often signalization of shifts in lead- – ership, and the poor performance of the first-tier growth stocks on this drop suggests that these issues may have, at best, entered into a consolidation phase and may, in many cases, test their 1974 lows. We continue to believe that this could take place without too much effect on the over- all market. The bulk of stocks remain in uptrends and show very little sign of distribution, and, until significant distributional patterns begin to form in a larger number of issues, we do not think that downside activity is likely to be serious. Dow-Jones Industrials (1200 p.m.) 835.11 S ; P Compo (1200 P.m.) 89.40 Cumulative Index (7/24/75) 528.16 AWT/jb ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL No stotement or ewpresslon of opmlon or ony other maHer herein contolned 15, or IS o be deemed to be, directly or Indirectly, an offer or the sollcltollon of on offer to buy or sell any security referred to or mentioned The matter 15 presen'ed merely for the conVerlenc of the subSCriber While -He believe the sources of our information to be reliable, we In no way represent or glJarantee the occlJracy thereof nor of the statements mude herein Ally action to be taen by the subSCriber should be based on hiS own investigation and Informollon Janney Montgomery Scott, Inc, as a corporahon, and Its officers or employees, may no have, or may later toke, POSitions OT trades In respect to any seCUrities mentioned In thiS or any futlJre ISsue, and such POSition may be different from ony views now or hereafter e .. pressed In thiS or any other ISlJe Janney Montgomery Scott, Inc, whICh IS registered With the SEC as on Investment adVISor, may give adVice 10 Its Investment adVisory and other customers Independently of any statements mode rn It-liS or In any other Issue Further information on any security mentioned herein IS avollable on request

TABELL'S MARKET LETTER J 909 STATE ROAD PRINCETON, NEW JERSEY 08540 DIVISION OF MEMBER NEW YORK STOCK EXCHANGE, INC MEMBER AMERICAN STOCK EXCHANGE – August I, 1975 – – , — —Forthe,IirsCtlme iirT975-thijs-far;tne'stciC'kjilarffifi'ncrsitself faCin-g'Tfarrry'- '– critical juncture. As the market has risen throughout the year, we have tried in this space to point out the futility of attempting to forecast much beyond the 850-900 level at which heavy over- head supply existed on the major averages. That level was, of course, attained at the closing high of 88L 81 on July 15. Since attainment of that high, the Dow has dropped to a closing low of 824.86 on July 29, this 6.45 drop being the severest of the bull market so far. The sharpness of the drop and its deep penetration into the 850-800 support zone raise real questions as to whether it mayor may not be the harbinger of something more serious. This question was left hanging at week's end as the market rallied in Wednesday's and early Thursday's trading before dropping off again late Thursday and early Friday. It may, however, be resolved shortly and thus give us some fairly important clues as to the longer-range stock market picture. The crucial levels at the moment are, first, 815 and then, 800 in terms of the Dow- Jones Industrials. These critical levels represent the lows of April and of May-June, and their penetration at this stage would make it likely that the trading that has taken place since that time constituted distribution. If such a penetration is, indeed, to take place, it would be more desirable, from the bullish point of view, to have it take place sooner rather than later. Based on the distribution formed so far, the worst possible downside objective would be in the 760-740 range, not a pleasant prospect, certainly, but hardly one which would rank as a major disaster. If this decline were to take place fairly shortly, it would be a quite typical example of the sort of surprise decline which in the past has been a not-uncommon feature of the maturer stages – -'–ofbuH-markets', -exa mples-being'JulYSeptember;-T9-5-67BndMay–June-;–196'5Suchdeclineshave i – in the past, exhibited some fairly consistent traits in that they tend to be 1) surprisingly vicious in terms of percentage drop, 2) over with rather quickly and, 3) followed by a return close to or through the previous pea k. The above, at the moment, is the worst we are able to envision. For a greater downside potential to exist, the sort of thing which would terminate the 1975 bull market, more distribution would have to take place around current levels. This, of course, may occur, but we must reiterate that the evidence pOinting to a drop of truly serious proportions is not yet at hand. Meanwhile, what of the bullish case We s'aid in this space on June 27, Thus, the most constructive technical action might, in fact, be a pullback, and, were this to take place, 800, another round figure, would become the crucial leveL Were a decline to the 800 level to ensue and hold, everything that has taken place sinc'e April would begin to look sus- piciously like the right shoulder of a massive head and shoulders base before which, it seems to us, the last supply barrier would ultimately have to fall. The first part of this scenario has already taken place. Ability to hold here and then, later, move to new highs would, in our view, be a sign of massive technical strength. It is hard to say at this juncture how the dilemma will be resolved. The signifi- cant technical weakness in the first-tier growth stocks would tend to lead one toward the bearish argument, since it is difficult to envision severe weakness in these issues not pulling the rest of the market down to some degree. The critical area that may decide the issue includes cycli- cal,-basic-industry groups such,as-steels ,- chemicals .andpaperR., These.issues.had.been mar-, ket leaders through April, at which point they began moving sideways in a relatively strong mar- ket, thus exhibiting deteriorating relative strength. Were these issues to penetrate their lows of May-June and follow the growth stocks downward, the case in favor of lower prices would become fairly strong. The ability of cyclical issues to hold at these levels, however, would be a strong argument that the market may ultimately resolve the dilemma on the upside. Dow-Jones Industrials (1200 p.m.) 828.61 S & P Compo (1200 p.m.) 88.41 Cumulative Index (7/31/75) 517.74 AWT/jb ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL NQ stotement or epresslon of opinIOn or ony other motter herem contclined I, or IS TO be deemed to be, directly or Indlfec'ly, on offer or the soliCitation of on offer to buy or sell any security referred 10 or mentioned The motter IS presented merely for the COnVerH!!nC 01 the subcrlber While we believe the sources of our mformatlon to be reliable, we m no way represent or guarantee the accuracy thereof nor of the stotement mude herein Any actmn to be token by the subSCriber should be based on hiS own investigation and InformotlOn Janney Montgomery Scott, Inc, as a corporation, ond Its officers or employees, may now have, or may later toke, POSitiOn or trades In respect to any securities mentioned In thiS or any future Issue, ond such p051tlon may be different from any views now or hereafter epressed In thiS or ony other Issue Janney Montgomery Scott, Inc, which IS registered With the SEC as on Investment adVisor, may give adVice to Its mvestment adVisory and other customers Independently of any statements mode In thiS or m any other Issue Further information on any security mentioned herem I available on request

–. – –'- – , I I I, TABELL'S I MARKET LETTER — — — ,– 1 909 STATE ROAD, PRINCETON NEW JERSEY 08540 DIVISION OF' MEMBER NEW VORl( STOCI( EXCHANGE, INC MEMBER AMERICAN STOCI( EXCHANGE – – — – ,.'ho – – —-, -Augtrst'r8-;r97S—- om; ..''-'''-'- .I The market technician must operate on many levels. One of these levels is, of course, the analysis and recognition of patterns in indiv1dual stocks. He must try to identify re cent trading as e1ther accumulation or distribution and attempt to formulate, from a stock's past price history, upside and downside targets and probabilities. Insofar as th,S task is concerned, his assessment of the current stock market pi cture can hardly fail to be anything other than a gloomy one. It is barely four weeks Since the stock market made its last bull market high, but the amount of pattern deterioration which has taken place in that short period has, indeed, been fairly massive. The process began with the appearance of significant d,stribution in the first tier growth stocks as these issues moved up underneath the heavy overhead supply from the 1973 74 tops. The malaise, however, has spread far beyond these 1ssues, and distributional patterns now appear in a Significant number of the 1500plus issues which we follow. It should be noted at the outset that these patterns are not of the major variety, and, in the great bulk of cases, favorable longterm patterns would remain undestroyed were the shortterm objectivs of the dis tributional tops which now exist to be reached. The whole process, however, could add up to a stock market atmosphere which would be hardly pleasant. Another level cn which the technician must function, however, is as an inter- preter of general market indicators. It is these indiCators that we, frankly, find difficult to square with be distributional patterns which have emerged in individual stocks. As we suggested above, the Dow made its bull market high just last month. That high was accompanied by breadth con 1t'o.flirmation–andJabsolutelynoneoftbesigns..oLdeterioJationw,ehayecomet2assoc;iate wi,thcw,the I–l long and usually slow process of forming a market tcp. Any downward momentum which might develop from here, therefore, would have to be placed in a category we have previously called a surprise decline, and the almost universal characteristic of declines of this nature is that, however painful they are while continuing, they tend to be followed by another attempt, at least, on the previous high. Still, a third level of the technician's work is that of a market historian. If the closing level of 881. 81 on July 15, 1975, is to prove to be a bull market top, this will constitute a bull market which has lasted for only 151 trading days. Such an animal 1S a rare beast, indeed, and is, in fact, by postWorld-War-1I standards unprecedented. The bull market of 1942-46 lasted 1211 trading days, the one of 1949-56, 1807 trading days and that of 1957-61, 1043 trading days. There has been some tendency toward a shortening of the time span since. 1962-66 was 913 trad- ing days long, 1966-68,518 trading days, and 1970-73,665 trading days. None of these, of course, remotely approaches the 151 trading days chalked up so far. Going back to the 1930's, we do have one possible precedent. The bull market of March-November, 1938, scored a 60 advance (slightly more than the current one) and did it in only 187 trading days. Even in that case, however, a 23 decline was followed by a renewed advance on the old high which was ultimately frustrated by the outbreak of hostilities in Europe. Although we strongly feel the market has, in many ways, radically altered its character in the past few years, it 1S difficult to envision as drastic an alteration as this one. We have warned in this space in the past against the bull'bear syndrome, that -isthecompulslve'terideiicVt(y-sfick-labels on every stock market-era-We tlllnk,thispatticolar– Iy dangerous in the present instance. A large number of issues, based on their technical patterns, are, at the moment, probably inappropriate as conservative investment vehicles. These issues, if still retained, should in most cases be sold. A number of others with favorable long-term patterns appear to present some fairly real short-term downside risk. The decision as to whether or not issues of this type should be retained will depend in large part on the investor's assess- ment of his own agility and his ability to reenter the market should the pattern agam turn favor- able. From a general market point of view, we think the possibility of lower pnces must be recognized without the compulsion to read cosmic portents of gloom and doom. Available evid- ence at the moment simply does not justify thfs sort of attitude. Dow-Jones Industrials (1200 p.m.) 821.03 ANTHONY W. TABELL S & P Compo (1200 p.m.) 86.49 DELAFIELD, HARVEY, TABELL Cum. Index (8/7/75) 497.73 AWT/jb No statement or expreslon of OPiniOn or any other moiler herein contained I, or IS to be deemed to be, dlfectly or Indlreelly, on offer or thc soliCitation of an offer to buy or sell any security referred to or mentioned Themall!.!rls presented merely for the conVCllenct of tne subscriber Wnde Ne believe the sources of our Information to be reliable, we In no way represent or guaranTee Ihe accuracy thereof nor of the statements mude herein Any aellon 10 be taken by the subscribe' shOuld be based on nlJ own investIgatIon and informatIon lanney Monlgommy .xotl, Inc, as a corporuhon, and I/S offIcers or employees, may now halle, or may later take, POSitiOnS or trades In respecl to any secuflhes mentIoned In thiS or any future Issue, and sucn position may be different from any views now or hnreafter expres;ed In thiS or ony other Issue Janney Montgomery Scott, Inc, which IS regIstered wltn the SEC as on Investment odvlsor, may gIve adVice to Its Investment adVisory ond otnel customers Independently of any statements made In tnls or In any other Issue Funher information on any securoly mentioned nereln IS aVailable on request

– –. .,- — – I TABELL'S MARKET LETTER — — .—- – – , 909 STATE ROAD, PRINCETON, NEW JERSEY 08540 DIVISION Of MEMBER NEW YORK STOCK EXCHANGE INC MEMBER AMERICA.N STOCI( eXCHANGE August IS, 1975 Ir, -The market wound up the week with its essential dilemma still unresolved. We pOinted sllaceC out two weeks ago!n-ihls that the cruc1al-ieveI; insofar as thE;'DowJonesfndustrials–werecon cerned, was 815-800. The barrier was penetrated, although not decisively, on August 5 when the Dow reached a closing low of 810.15, but this was followed by six days of a rather tepid rally which brought' the Index to a closing high of 828.54 on Tuesday of this week. Ten points of this gain were then given up in Wednesday's and Thursday's trading. We have thus, at the moment, no real clue as to the market's near-term direction. We are lucky, however, in that it has now become clear, from a technical point of view, in what direction we should be looking for such a clue. If the cavalry is suddenly to appear over the horizon and res- cue the pres ent stock market, we know the direction of the horizon on which they will appear. That horizon will be in the area of the old line, heavy-industry cyclical issues — steels, papers, forest products, chemicals, non-ferrous metals and automobiles. The debacle in the market to date has been largely restricted to the first-tier growth stocks as graphically illustrated by the following table based on Wednesday closing prices. It shows the close for 11 growth issues on May 14 followed by their close just three months later on August 13. As can be seen, the average performance is a close-to-20 decline, four times as great as the Dow and three times as great as the S & P 500. The eight cyclical issues shown at the bottom of the table, however, have declined on average only 3.1 over the same time period, actually outperforming both averages. Subse- 5/14/75 guent High 8/13/75 Change 1-1I-Avon…..P..roductss 4'l95L8 — 39 … 3L820.17 – 1 Coca-Cola 92 92 1/2 76 3/4 -16.6 Disney Productions Eastman Kodak 543/4 1083/4 – 415/8 -24.0 917/8 -15.5 International Business Machines International Flavors & Fragrances 223 1/2 33 7/8 – 177 1/2 27 -20.6 -20.3 Johnson & Johnson McDonald's Corp. 97 1/2 59 99 – 86 1/4 -11.5 445/8 -24.4 Procter & Gamble Sears, Roebuck & Co. Xerox Average DJIA S&P 97 71 3/4 86 1/4 858.73 92.27 98 735/8 – 88 1/4 607/8 54 5/8 820.56 85.97 – – 57 7/8 40 1/2 73 3/4 – 41-1/2 – 9.0 -15.2 -36.7 -19.5 – 4.4 – 6.8 Downside Breakout 33 42 32 48 30 60 54 36 Having moved down as much as they have, the growth issues are almost uniformly in con- firmed minor downtrends, and lower prices appear indicated. However, were the cyclicals to avoid posting downside breakouts similar to those already posted by the growth issues, the general market might gain badly needed succor. For the cyclicals, the downside breakout level is noted in the table. Abillty of most or all of these issues to hold above the breakout levels indicated would constitute a highly constructive sign. Note The above comments are based on technical factors. Further information on all companies is available on request. Dow-Jones Industrials (1200 p.m.) 820.64 S & P Compo (1200 p. m.) 86.01 ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL Cumulative Index (8/14/75) 488.01 AWT/jb No statement or expreUIon of oplnlQn or Clny other molter here,n olltomed IS, or IS to be deemed 10 be, directly or ,directly. on offer or the soliCItation of an offer to buy or sell any security referred to or mentioned The mOiler IS presented merely for the conver,enclO of the subscrIber While we believe the s.ources of our 'nforma tlon to be reliable, we In no way represent or guarantee the accuracy thereof nor of the statements mude hereIn Any actIon 10 be toen by Ihe subSCriber should be based on h,s own InvestigatIon and informatIon Janney Montgomery Scali, tnc , 05 a corporallon, and Its offIcers or employees, may now have, or may later toke, positIons or trades …. respect to any secufll,es mentIoned In thIS or any future Issue, and such POSItIon may be different from any vIews now Or hereafter erpressed In If1l5 or any other Issue Janney Monlgomery Scali, rnc, whICh IS regIstered WIth the SEC as on Investment adVIsor, moy gIve adVIce to lIs Investment odvlsory ond othel customers Independently of any statements mode In thIS or …. any other Issue Further informatIon on ony senmty mentIOned hereIn 15 avaIlable on request

r , TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON NEW JERSEY 08540 DIVISION OF MEMBER NEW YORK STOCK EXCHANGE, INC MEMBEA AMERICAN STOCI( EXCHANGE August 22, 1975 .,.TheJleJeriQr.a tion.oftl1!'Joctm-',!Jk!'s,technicalcQndition. whichha.,;beenthe ..,, feature of the last two months of trading, continued this week with accelerating force. In a two- day plunge of almost 30 points on Tuesday and Wednesday, the Dow-Jones Industrial Average decisively penetrated the BI5-BOO level to which we have been drawing attention over the past month as the critical barrier. Other indices penetrated simllar distributional formations, strength- ening the likelihood that what has been transpiring in the market since last May constitutes a distributional top. Under such conditions, quite obviously, lower prices become a probability, and two questions immediately present themselves to the forecaster — I) How far IS the decline likely to carry, and 2 ), What is its most plausible aftermath Insofar as the first question is concerned, the answer must be that all the evidence available at the moment is that the decline will not carry all that much further. The most plausible downside objectives in terms of the Dow-Jones Industrial Average are 740-725. The one eventuality which would indicate the likelihood of objectives lower than these was discussed at some length in this letter last week. That would be further deterioration on the part of the cyclical, heavyindustry issues whIch have so far resisted the decline. This has not yet occurred and, mdeed, such a cyclical bellwether as U. S. Steel posted a minor upside breakout on Friday just before the decline commenced. The validIty of more conservative downside targets IS further attested to byanaly- – …..-.s i s-of-th-e,d i-str-ibuti 0lOa1-Ol'ma-tiOl'ls.,on…th e…mor-e.bl;Oadl-y-bas ed.a-v-8r-il g es,, 0 5 tof–th es e.a vera g ess 1 have clearly defined tops which are susceptible to only one interpretatlOn,and, m many cases, the downSide objectives of these tops are bemg reached. The S & P 425 (93.22) has a downside target of 92-91,and their 500-Stock ComposIte (B3.07) has an objective of B2. The New York Stock Exchange Industrial Index (49.07) suggests a possible 4B, and the NYSE Composite (44.22) has a downSide objective of 43. These targets are all close to bemg approached at the moment. However far the decline carries, however, one likelihood remains, that IS, that its eventual aftermath WIll be, at least, another assault on the July hIghs. This would be true even were the distributional patterns to broaden and suggest lower objectives. At the conclusion of such a process, most issues which moved into major long-term uptrends early this year would have done no more than return to long-term support levels, with their bases, which suggest conSIderably higher levels over the long-term, still mtact. In the case of a great many other issues which turned down from the heavy overhead supply from their 1973-74 tops, a decline back to around the 1974 lows would have the effect of broadening bases to the extent that the next assault on the overhead supply might be successful. In addition, as we have pointed out in prevIOus issues of this letter, the decline commenced without the signs of deterioration which have m the past accompanied market tops of major proportions. Thus, the likelihood that the market will eventually retrace the bulk of the ground lost is fairly strong. — ec '—-, In one sense ,the action'oLthe market'over.thepast-few,months has-been consls- tent with a behavior pattern which IS now over a decade old. The present drop is the thIrteenth instance since 1965 which has seen the Dow ha It at a point at or just under the 900-1000 level (in one case, slightly higher than this level) and subseqJenUy decline close-to-IOO pOints or more. We have, in the past, called this the Something-Up-There-Doesn't-Llke-Us phenomenon. It is, of course, just another way of stating that the central characteristic of the market over the past ten years has been a rather flat trading range. The present decline fits squarely into the context of that pattern. Dow-Jones Industrials (1200 p. m.) S & P Compo (1200 p.m.) Cumulative Index (B/21/75) AWT/jb 794.43 B3.34 470.70 ANTHONY W. TAB ELL DELAFIELD, HARVEY, TIIBELL No statement or expression of opinion or any other moIler here'n tonlomed Ii, or IS to be deemed to be, directly or 'ndlrectly, on offer or the sollc,lollon of on offer 10 buy or sell any security referred 10 or mentioned The molter I presented merely for the converlenCE of the subSCriber While we believe the sources of our information to be reliable, we In no way represent or guarantee the occurocy thereof nor of the statements mude herein Any adlOn to be token by the 5ubscrlber should be based on hiS own Investlgailon and Informohon Janney Montgomery Scott, Inc, as a corporation, and Its officers or employees, may now have, or may later take, pOSitIOns or trodes In respect to any seCUrities mentioned In thiS or any future Issue, and such position moy be different from any vlev..s now or hereafter expressed In thiS or any other Issue Janney Montgomery Scott, Inc, whICh IS registered With the SEC as on Investment adVisor, may give adVice to ItS Investment adVisory and other customers rndependently of any statements made In thIS or In any other Issue Further Informatron on ony securrty mentioned herein IS aVailable on request L –

TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON. NEW JERSEY 08540 DIVISION OF MEM8ER NEW YORK STOCK EXCHANGE, INC MEMBER AMERICAN STOCK eXCHANGE August 29, 1975 Mter brea king sharply into new lower territory a week ago, the stock market -ra-llied sharply'l.a st4'riday and, -after -three-days-of consoHdation, -extended-the- advance-with -a-2 2- ..' point rally on Thursday. For the -moment, we continue to hold the view expressed in last week's letter that lower prices may well be seen but that said lower prices will be not that much lower than the recent lows and that their aftermath will be, at least, an assault on the old high in the upper 800' s on the Dow. Whatever the near term vicissitudes of the stock market, there are emerging, in our view, a number of grounds to warrant longer-range optimism. Basically, the aggregate of stock prices is determined by two factors, earnings and investor confidence — expressed in the multi- ple that the stock market is willing to pay for those earnings. As we all know, that investor con- fidence reached its all-time nadir last fall at the same time earnings were reaching all-time peaks. The PIE ratio for the Dow was, at that pOint, the lowest it had ever been since earnings for that Average have been recorded. Since last fall's lows, the Dow multiple has risen noticeably due to the combination of rising prices and lower earnings, but on a cyclical baSis, an astounding a mount of room rema ins on the ups ide. In addition, we think, there are grounds for optimism as to the future of corporate profits. As the recession bottoms, we think it axiomatic that the Gross National Product will rise in the second half of 1975 and on into 1976, at least in dollar terms. The question, of course, is what percentage will corporate profits constitute of that riSing GNP. Now, corporate profits as a percentage of GNP is a statistic that has behaved similarly in most economic cycles. The percentage has reached a low in each recession in the – -postwar' perlod'and'ha-s tend-edtoexpan&wtththeucceedingbusi.nes-sexpa nsion –GeneraHyjit– – has tended to peak out well in advance of recessions and has been a pretty fair leading indicator of such recessions. The following table shows the pre-recession high for profits as a percentage of GNP, the number of quarters lead on the beginning of the subsequent recession and the reces- sion lows for each of the five recorded postwar receSSions, plus the current one. Pre-Recession High No. of Recession Low Year-Qtr Profit as GNP Qtrs Lead Year-Qtr Profit as GNP Nov 1948-0ct 1949 1947-3 9.26 6 1949-4 7.10 July 1953-Aug 1954 1950-4 11.00 9 1953-4 4.60 July 1957-Apr 1958 1955-4 6.92 5 1958-1 4.55 May 1960-Feb 1961 1959-3 6.33 3 1961-1 4.85 Nov 1969-Nov 1970 1965-4 6.94 15 1970-4 3.70 1974-1975 1974-3 6.66 0 1975-1 4.40 On their face, the statistics do not present much grounds for optimism. The last four business expansions have produced similar peaks in the series, and most recessions have' produced similar lows. We think there are grounds for encouragement for two reasons, however. One is that profits will have probably bottomed out in the current recession at higher levels than the all-time lows reached at the bottom of the 1970 receSSion, and secondly, that on the expan sion into the third quarter of last year profits continued to expand as a percentage of GNP right up until the moment the economy turned down, rather than leading the downturn. – – 'It may well be a-sked, of cOUrse, why the profits percentage should'exparid-from the 4.5 – 6.9 range which has characterized it since the early 1950's. We think a justifica- tion can be made on the grounds that profits are undeniably understated, since years of inflation have rendered depreciation charges woefully inadequate. There is no way that current deprecia- tion allowances could cover the replacement cost of current plant. Under these circumstances, we can foresee distinct upward pressure on prices, and we have, indeed, seen an indication of this in the rise in commodity prices despite the obvious recessionary characteristics of the econ- omy during the first half of this year. We think this upward pressure could exert a long-term ex- pansionary force on profit margins and, ultimately, on profits and stock prices. Dow-Jones Industrials (1200 p.m.) 832.99 ANTHONYW. TABELL S & P Compo (1200 p.m.) 86.70 DELAFIELD, HARVEY, TABELL Cumulative Index (8/28/75) 486.67 AWT/jb No statement or expresSion of opmlon Or any olher motler herein contomed IS, or IS to be deemed to be, dlfectly or indirectly, on oHer or the soliCitation at an offer to buy or sell ony secvrlty referred 10 or menlloned The moTter IS presented merely for the conver,enC6 of Ihe subSCriber While we believe the sources of our information to be reliable, we In no way represen! or guorontee the accuracy Ihereof nor of the statements mude herein Any action to be token by the subscriber should be bosed an hiS own mvestlgollon and information Janney Montgomery Scott, Inc, 05 a corporation, and lIs officers or employees, may now hove, or may later Joke, pOSitiOnS or trodes m respect to ony securities mentioned m thiS or ony future Issue, and such posl'lon may be different from ony Views now or hereofter epressed In thiS or ony other Issue Janney Montgomery Scott, Inc, which IS registered With thc SEC os on Inves/ment adVisor, moy give odvlce to Its Inveslmenl odvuory and olher customers Independently of any statements mode In Ihls or In any other Issue Further mformotlon on any security mentioned here'n IS avollable on requesl

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