Viewing Month: October 1980

Tabell’s Market Letter – October 03, 1980

Tabell’s Market Letter – October 03, 1980

Tabell's Market Letter - October 03, 1980
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TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON, NEW JERSEY 08540 DIVISION OF MEMBER NEW YORK STOCK eXCHANGE. INC MEMBER AMERICAN STOCK eXCHANGE – —-''.J – -'– October 3, 1980 Analysis of the market in terms of seasonal tendency has become fashionable of late. We succumbed to the temptation ourselves last week, when we devoted an entire letter to explaining the significance of the market's closing up in September. At that point, the market turned down, and the Dow closed slightly lower for the month of September, demonstrating one more peril of the market-forecasting profession. The current popularity of seasonal analysis probably stems from the fact that, in recent years, fall has brought a chill in more ways than one. 1978 and 1979 both featured sharp and short corrections sometime during the autumn. ,This recent history, coupled with the rather noticeable loss in the market's upside momentum over the past couple of months, has produced a certain nervousness on the part of a number of stock market observers. Actually, the August-September record of the market is mixed and depends in large part on what index one looks at. Essentially, that record consists of a lateral trading range for the month of August, followed by a rally to new highs in mid-September, followed, in turn, by a total or partial retracement of that rally. In the case of certain averages, notably the DowJones Industrials, the September highs were not all that different from the August ones, and the retracement of the rally was just about complete. In other averages, new highs were achieved by a substantial margin. In a few cases, notably interest-sensitive indicators, the September rally was just about non-existent. In any case, almost all market indices (with the exception of the unusually strong transporta- l- tives are set out in the table below. Average Recent Level Downside Breakout Objective Dow-Jones Industrials Dow-Jones Utilities S & P 500 S & P 400 S & P Utilities S & P Financial NYSE Composite NYSE Industrials NYSE Financial AMEX Mkt Value 944.03 110.12 128.59 146.50 50.57 13.15 74.29 86.87 68.34 339.79 915 107 120 138 49 12.70 68 81 65 322 880-870 102-97 115 132 43 12.20-11.50 64 75 61 306 A number of facts should be noted. First of all, in no case has a downside breakout taken place. Secondly, in no case is the downside target all that significant. The worst that can be foreseen is a sort of conventional result — the same sort of autumnal sinking spell that has taken place in the past couple of years. In fact, based on present indications, such a sinking spell, if indeed it occurs, should be somewhat milder than any of the three previous ones. 1 Theif in the above sentence is the operative word. We tend to have a certain intuitive s'lspicion of obvious forecasts, and we think that the present expectation of fall weakness based on the recent history belongs in that category. If downside breakouts from ranges outlined in the table above do begin to take place, a modest decline can be anticipated, and we would conduct money management activities based on that anticipation. We would, however, await such breakouts before expecting even short-term weakness. Dow-Jones Industrials (1200 PM) S & P Composite (12 00 PM) Cumulative Index (10/2/80) AWTsla 944.03 128.59 995.37 ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL No statement or c)(preSSlon of opInion or any other motter hercln contolned I, or IS to be deemed to be, directly or ,ndlrec!ly, on offer or the soitcltatlon of on offer 10 buy or sell cny security referred to Or menhoned The mOiler IS presented merely for the (onverlenCE of Ihe ubscrlber While we believe Ihe sources of our Informa han 10 be reliable, we In no way represent or guoronlee the accuracy thereof nor of the ml,lde herein Any acllon to be token by the subSCriber shOUld be based on hiS own inVestigation and Informollon Janney Montgomery Scolt, Inc as a corporation, and 115 off'cers or employees, may now have, or may loler lole, POSitiOns or Irades In respect 10 any seCUrities 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 Scott, Inc, wtllch ,s registered With the SEC os on Investment odvlsor, may give adVice to ItS Investment adVisory and othe. customers Independently of any statements mode ,n thiS or In any other Issue further 'nformotlon on any security mentioned herern IS ovollable on request

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Tabell’s Market Letter – October 10, 1980

Tabell’s Market Letter – October 10, 1980

Tabell's Market Letter - October 10, 1980
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TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON. NEW JERSEY 08540 DIVISION OF MEMBER NEW YORK STOCK eXCHANGE, INC MEMBER AMERICAN STOCK EXCHANGE October 10, 1980 – ,– We–f6un1 -oursel'veatdit'frYe1rremnef nlglit -engage'd-inon-eM tile – which tend to emerge in the company of perceptive colleagues. The basic question which the dinner-table conversation sought to explore was, To what extent does speculation exist in the current stock market The topic is not an infrequent subject of discussion among those who share a background in classical technical analysis. In its early days, stock-market analysis, like most other disciplines, developed a number of conventional wisdoms, and one of these, in simplest terms, was that specu- lation was bad, and, conversely, lack of speculation was good. A high degree of speculative activity allegedly suggested the presence of potential irrational sellers, while the lack of same was said to indicate a market dominated by hard-headed professional investors who were unemo- tionally taking advantage of the bargains created by previous waves of speculative selling. This perception is firmly grounded in the standard literature, going back to John MacKay's narrations of the Holland Tullip Bulb Mania and the South Sea Bubble, and continuing through the various histories of the 1929 stock market crash. It has its roots in a fundamental perception which acknowledges that among the baser human emotions are fear and greed, and that these emotions, in varying degrees, tend to reflect themselves in financial markets where the partici- pants are, after all, individual humans. The technician is, by one definition, indirectly a market psychologist. It is his task to develop quantitative indicators which measure the sort of emotional factors discussed above. A recent prob- lem is that many such quantitative indicators, especially those developed in the 1940's and 1950's, are turning out to be somewhat less than useful at the moment. For many years, the level of American Stock Exchange volume, for example, was an excellent proxy for speculative activity. Today, interpreted in conventional terms, that indicator would suggest that almost no speculation -existealort11ebetterpa-rrof-a-.lecHde–Durin-g-this-supposedly American Stock Exchange Market Value index has advanced 475 in an almost uninterrupted six- year cycle during a time when most other market indicators were doing very little. The exception- al market performance of secondary stocks in general, the sort of stocks that are supposedly the focus of purely speculative interest is, of course, a well-documented fact. With the confusing picture being painted by these indicators, the question of the existence of speculation or lack thereof becomes, as we suggested, particularly interesting. The proper answer must, we think, involve a return to psychology. Investment is, essentially, the intelligent balance of risk versus reward. The sort of speculative activity considered bad in the classical percep- tion is characterized by the presence of large numbers of investors who, for one reason or another, are deluded into focusing their attention solely OJ1 the reward while ignoring the risk. This delu- sion can take many forms. There is little qualitative difference between the individuals who thought it perfectly safe to purchase stocks on 10 margin in 1929 and the professionals who created high-minded rationalizations for buying growth stocks at 50-100 times earnings in 1972. Both were concentrating on reward and ignoring risk. On a purely intuitive basis, we are not entirely certain that this sort of thing exists to an excessive degree in today's stock market. That activity involving risk, in some cases high risk, abounds, cannot be denied, as secondary-stock performance, options volume, and other indicators clearly demonstrate. We have, in the past, expressed the belief, however, that, following a decade of obvious exodus by individuals from the stock market, the surviving stock-market investor is a hardy breed. We suspect that his very survival indicates that his risk-awareness remains a well- developed instinct. To find examples of lack of risk-awareness and excessive reward-obsession today, we think one must range far afield from the stock market into markets -for other financial assets. It is – possible to wonder, for example, about the degree of risk-awareness being demonstrated by inves- tors in such areas as precious metals, art, and other collectables. The most dangerous sort of market, of course, is the one where the conventional wisdom of just about every participant sug- gests that the direction of prices can only be upward in an unending curve extending into the indefinite future. For an example of a market that fits that definition in 1980, how about residen- tial real estate The existence of speculative activity in other areas, of course, may be precisely what has confused the stock market scene. What the eventual interrelationship will be is a question which remains unanswered. Dow-Jones Industrials (12 00 PM) 958.96 S & P Composite (12 00 PM) 131. 17 ANTHONY W. TABELL DELAFIELD, HARVEY, TAB ELL Cumulative Index (10/9/80) 1022.34 AWTsla I No lfotemenl Qf ew.preulon of opinion or any other motler herein contolned or 1 to be deemed 10 be, directly or mdlrectly, on offer or the SOllcltotlon of on offer to b\Jy Of leU ony security referred to or menltcmed The maUer 15 presenled merely fo' the convertencc of the subscrtber Whtle e believe the sources of our information to be rei table, we In no way represent or guarantee the accuracy thereof nor of the statements mude herein Any aellon to be taken by the subscrtber should be ba!.ed on hiS own investIgation and Informallon Janney Montgomery Scoll, Inc, os a corporation, and Its officers or employees, may now have, or may laler take, positions or trodes In respect to any securohes mentioned In thiS or any future luue, ond such pas Ilion moy be different from any views now or hereafter e)!prcssed m thiS or any other I!.sue Janney Montgomery Scott, Inc, which IS regIstered With the SEC os on mvestment adVisor, may give odvlce to liS mvestment adVisory and other customers mdependently of any statements made ,n thIS or m any other Issue Further information on any sccury mentioned herein IS ovculable on request

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Tabell’s Market Letter – October 17, 1980

Tabell’s Market Letter – October 17, 1980

Tabell's Market Letter - October 17, 1980
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TABELL'S MARKET LETTER 909 STATE ROAD. PRINCETON. NEW JERSEY 08540 DIV'SION OF MEMBER NEW VORK STOCK EXCHANGE, tNC MEMBER AMERICAN STOCK EXCHANGE October 17, 1980 – —We have as 'we ….skeEl-ftt what –I the most likely course Jor the 'siock market assuming one Presiaimtial candidate or tlie-other is elected next month. Very often the asker of this question is an avid Republican or Democrat who is interested in proving the thesis that his party offers the better hope for the market and lor the economy. Presented below are some statistics which should please partisans of neither stripe. The table shows the percentage change in the stock market for one, two, three, and six-month periods and one, two, three, and four-year periods following the October close of each Presidential election year since 1900. Summarized at the bottom of the table are a number of averages. The first shows the average percentage change in the market for all years since 1897 over the periods in question. The second shows the average change for the various periods following election years. Following this are averages for periods following election years which elected a) a Republican, and b) a Democrat; and periods following election years in which a) the incumbent party was returned to power, and b) a new party was installed in power. PER C E N T C HAN G E 0 V E R YEAR PRESIDENT PTY 1 MNTH 2 MNTH 3 MNTH 6 MNTH 1 YEAR 2 YEAR 3 YEAR 4 YEAR I900 Mcklnley 12.79 19.77 13.16 28.39 9.16 11.89 -23.56 6.76 1904 Roosevelt R 14.26 10.44 13.17 20.70 32.91 47.41 -8.46 30.94 1908 Taft 1912 Wilson R 5.78 4.39 1.89 6.98 20.04 2.71 -8.17 9.91 D 1.36 -3.13 -7.71 -13.42 -13.68 -21.27 44.50 57.42 1916 Wilson D 1.30 -9.19 -8.78 -10.88 -28.78 -18.26 13.68 -18.79 1920 Harding 1924 Coolidge R -10.49 -15.30 -10.38 -7.19 -13.82 13.14 4.21 22.50 R 7.03 15.81 18.41 15.33 50.41 44.51 74.64 142.32 1928 Hoover R 16.35 18.97 25.92 26.62 8.47 -27.29 -58.19 -75.45 1932 Roosevelt 1936 Roosevelt D -8.97 -3.18 -1.62 25.46 42.42 50.82 125.75 186.25 D 3.40 1.53 4.83 -1.65 -22.02 -14.37 -14.28 -24.03 .59 -7 79 .-13 I 2.4–1.5 .262.22-B1l.6 1944 Roosevelt D 0.55 3.95 4.87 12.91 27.35 15.44 23.65 28.72 1948 Truman D -9.24 -6.00 -5.04 -7.67 0.49 19.29 39.09 42.74 1952 Eisenhower R 5.36 8.42 7.63 2.05 2.44 30.80 68.95 78.23 1956 Eisenhower R -1.47 4.09 -0.14 3.02 -8.09 13.21 34.75 20.95 1960 Kennedy D 2.91 6.12 11.69 16.95 21.29 1.62 30.13 50.44 1964 Johnson D 0.27 0.12 3.41 5.64 10.05 -7.56 0.76 9.08 1968 Nixon R 3.43 -0.91 -0.67 -0.23 -10.12 -20.66 -11.91 0.33 1972 Nixon 1976 Carter AVERAGES R 6.56 6.75 4.55 -3.57 0.11 -30.38 -12.50 0.98 D -1.84 4.12 -1.09 -3.94 -15.19 -17.87 -15.47 -3.37 All Years Election Years 0.52 1.96 2.94 4.27 6.46 12.98 17.68 23.92 2.33 3.21 3.32 5.07 5.05 3.90 15.52 28.74 Repub. Elected Dem. Elected 5.96 7.24 7.35 9.21 9.15 8.53 5.98 23.75 -1.29 -0.82 -0.72 0.92 0.94 -0.74 25.05 33.73 Incum. Re'lcted 4.22 5.23 5.27 6.28 6.74 3.18 4.93 14.08 New Party -1.18 -0.55 -0.31 2.81 1.91 5.23 35.17 55.97 The line showing average performance for all election years tends to suggest a positive outlook from now until early 1981. One, two, and three-month periods following October in election years are significantly better than the average of all years. On the other hand, the same line demonstrates that the first halves of Presidential terms tend to show below-average stock market results, as demonstrated by the sub-par one and two-year performances following past Octobers when a Presidential election was held. Republicans will be delighted to know that, for the first two years of a Presidential term, the stock mar- ket tends to perform considerably better if a Republican is elected than if a Democrat is elected. Democrats, on the other hand J will not be reluctant to point out that, over three and four-year periods following elections, the market has acted considerably better under Democratic administrations than under the GOP. Before either party draws much comfort from these statistics, however, it should also be pointed out that the market tenqs to perform well over the short term when the incumbent party is returned, but poorly over the longer them. By contrast, the instaUation of a new party tends to produce poor short-term stock-market results but very good stock markets over the first three years and the four years of the new President's term. The election of Mr. Reagan, in other words, should be bullish for the short term and bearish for the long term since he is a Republican, but just the opposite since he will, if elected, be replacing an incumbent Presi- dent. Mr. Carter's election, by contrast, may be viewed as bearish for the short term since he is a Democrat but also bullish for the shari term since he is the incumbent. His party makes the long-range outlook follow- ing his election optimistic, but his incumbency suggests the opposite view. None of this. we are afraid, seems to prove very much except that the stock market is a complex beast. As noted, we doubt that partisans of either side can draw much ammunition from the above statistics. Dow-Jones Industrials (12 00 PM) S & P Composite (1200 PM Cumulative Index (10116180) AWT sla 957.42 131. 87 1025.46 ANTHONY W. TAB ELL DELAFIELD, HARVEY, TABELL No statement or expression of opinion or ony other matter herein contained IS, or IS to be deemed to be, directly or Indirectly, on offer or the soliCitation of on offer to buy or sell ony security referred to or mentioned The molter IS presented merely for the COnVcr'lenC(I of the subscnber While lie believe the sources of our Informa- tion to be reliable, we In no way represent or guarantee the accuracy thereof nor of the slalem('nlS mude herein Any action to be loken by the subSCriber should be based on hiS own Inve5gollon and information Janney Montgomery Scali, Inc, os a corpOfOllC)n, and Its offICers or employees, may now have, or may later loke. pos.hons or lrades In respect 10 any menl10ned In IhlS or any future ond such moy be different from any views now or hereafter expressed In or any other Inue Janney Monlgomery Scott, Inc, whICh IS registered With the SEC as on Investment adVisor, may give odvlCe to lis ,vestment advltory and other customers ,dependently of any statements mode, thiS or In any other Issue Furlher information on any sectmty mentioned herein available on request

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Tabell’s Market Letter – October 24, 1980

Tabell’s Market Letter – October 24, 1980

Tabell's Market Letter - October 24, 1980
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TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON. NEW JERSEY 08540 DIVISION OF MEMBER NEW YORK STOCK EXCHANGE, tNC. MEMBER AMERICAN STOCI( EXCHANGE October 24, 1980 It is now apparent that the stock market has entered into a new phase, which phase can be dated, – approximately ,-from .A when the Dow-Jones.lndustria!, Average reacllecl, a, high oLlI6li. 72.This high was followed, three weeks later,- by a closing low of 928.58 on September 8 and a-'sharp rally to a 1980 high of 974.57 on September 22. A week later the Dow had plummeted to 921.93 on September 29, and three weeks afterward had rallied to 972.44 on October 15. It has since retreated, most notably in a 15-point slide in Thursday's trading. The action of the S & P 500 over the same period has been similar, but with more of an upward bias, that index's 1980 high having been reached at 133.70 just about a week ago. We have, quite obviously, a trading range circumscribed by the 5.71 range, between 921 and 972, over which the market moved in late September, and market action for the past two months has essen- tially been contained within this range. Trading ranges may be defined as the range of a given index over some fixed number of days, 50 trading days having been proven to be an appropriate figure for analytical purposes. Ever since October 6 the high and low for the Dow over the preceeding 50 days has been confined by the 5.71 figure mentioned above. This statement has continued to be true for the last 15 days. This is, by no means, an unduly long period. The following table lists all periods of 30 days or longer since 1949 when the difference between the 50-day high and low for the Dow has been less than 6. Also tabulated are the one-month, two-month, and six-month changes in the DJIA following the periods in question. Daie JUN 3 1949 MAR 24 1950 IEC 30 1950 A 51 JUN 26 1952 NOV 18 1952 APR 2 1953 SU' 10 1953 MAR 2 1956 AUG 13 1957 MAY 5 1958 JUN 3 1960 AUG 3 1961 NOV 14 1961 JAN 25 1962 1962 AUG 29 1963 JUL 16 1964 JUN 8 1965 FEB 28 1966 HAY 1 1969 JUL 14 1972 OCT 8 1976 HAY 23 1977 JUL 26 1977 AUG 10 1979 In DJIA IlLEod 59 167.24 55 209.78 37 235.41 35' '1c;21-L3 71 271.24 65 278.04 44 280.03 38 262.88 33 488.84 38 492.14 39 461. 12 36 628,98 48 715.71 30 732.56 35 696,52 32 683.69 55 7'6.40 75 847.47 145 889.05 73 951. 89 36 949.22 49 9.22.26 115 958.38 48 917.06 38 908.18 34 867.06 I J I A ll!oot,b l Cbs 170.68 2.06 1.88 244.51 3.87 c.!l.9j .;lO 278.57 -3.05 2.70 286.52 3.05 278.22 -0.65 266.09 518.65 '–1 'i . 6.10 481.0' 468.55 1. 61 640.37 1 .81 718.72 0.42 729.40 -0.43 1.82 611.88 -10.50 738.33 1.64 840.21 -0.86 879.49 -1 .08 919.76 -3.38 930.78 -1.94 969.97 5. 17 924.04 -3.58 925.37 0.91 854.12 -5.95 870.90 0.44 Af t e r 3Ciooibs LCbs 179.07 7.07 219.70 4.73 252.18 7 t 12 250.43 -2.61 74.41 1.17 287.84 3.52 267.63 -4.43 275.93 4.96 516.44 5.65 447.90 -8,99 480.00 4.09 614.29 -2.34 708.49 -1.01 696.03 -4.99 711.28 .2 1! 536.98 -21.46 755.23 3.97 868.67 2.50 878.89 -\ .14 931. 95 -2.09 886.12 -6.65 947.32 '.72 974.24 1.65 888.4, -3.12 835.85 -7.96 838.89 -3.25 6!iooibs 193.23 218.33 24Q.65 275.74 'B'-;-O-' 78.04 264.79 298.88 500.90 543.31 594.56 702.54 655.36 574.67 568.60 802.75 887.18 939.53 792.37 848.34 1025.59 918.88 770.70 885.49 LCbg 15.54 4.08 6.05 7.24 '6 T9 0.00 -5.44 13.69 2.47 -10.12 17.82 -5.47 -1.84 -10.54 -17.49 -16.83 10.51 4.69 5.68 -16.76 -10.63 11 .20 -4.12 -8.87 -15.14 .2.13 Results are diverse. The major bear markets of 1957, 1961-62-, and 1966 were preceeded by such trading ranges, as was the decline of 1977-78. In many other cases, however, as the table quite clearly shows, the trading range proved only a stopping point on the way to what ultimately proved to be significantly higher prices. What is perhaps interesting is that with the single exception of April, 1962, there was no case where the market moved significantly lower after only a one-month period. The trading ranges, in other words, tended to occur early in the distributional stage, affording time to react if downside breakouts made it obvious that they constituted distribution. This, we think, will be the case in 1980 if, indeed, the present phase turns out to be a distributional top. Dow-Jones Industrials (1200 PM) 938.57 S & P Composite (12 00 PM) 129.28 Cumulative Index (10/23/80) 1006.88 AWTsla ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL No statement or expression of OPinion or any other molter herein contained IS, or 15 to be deemed to be, dHedly or Indirectly, on offer or the SollCitotlon of on offer to buy or sell any security referred to or mentIOned The matter IS presented merely for the COnvePlcnce of the subscriber While oNe believe the sources of our Information to be reliable, we In no way represent or guarantee the accuracy thereof nor of the stotements mude heretn Any action to be token by the subcnber should be based on hiS own Investlgollon ond tnformottol Janney Montgomery Scott, Inc, as a corporation, and 11 officers or employees, may now hove, or may loter take, POSltlOrtS or tlodes In resped to ony securttles merttloned in th.s or ony future lSue, ond such position moy be dlfferenl from any views now or hereofter e;rpreSed In or any othttr luue Janney Montgomery Scott, Inc, whICh 15 reglllered WIth Ihe SEC as an II'1ve/ment advl50r, may give adVICe 1o liS Investment adVIsory and other customers Irtdependerttly of arty stotements mode Irt thiS or In any other ISSUe Further IOformatlon on any secullty mentIOned herein IS available on request

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Tabell’s Market Letter – October 31, 1980

Tabell’s Market Letter – October 31, 1980

Tabell's Market Letter - October 31, 1980
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TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON. NEW JERSEY 08540 DIVISION OF MEMBER NEW YORK STOCK EXCHANGE, INC MEMBER AMERICAN STOCK EXCHANGE October 31, 1980 – atraditionstartedin this 'market letter 32 'years'ago, ..,. to forecast the winner of Tuesday's Presidential election As 'old-time readers know, our record in this exercise is considerably better than our stock-market record, since all such forecasts made in the past have been correct We find ourselves, therefore, under a certain amount of pressure, since the conventional wisdom assures us that this election is the closest in years, and most analy- sts are refusing to hazard a guess as to the outcome. In approaching the task, we reminded ourselves that this is, after all, a technical market let- ter and that technical analysis consists essentially of reasoning from past publically-available data. The results of the past two Presidential elections indeed constitute such data, and we have spent a couple of days manipulating them. In this work, we attempted to follow the rules of the election itself and worked with alternative electoral-vote scenarios, using the popular vote only indirectly. It is interesting to note that most polls focus exclusively on popular vote total. Tradition demands a forecast, and accordingly, using the, approach above, we forecast the election of Governor Reagan. It is perhaps worth recalling botJi 1972 and 1976 results. The first was a landslide for Mr. Nixon,in which his opponent carried only Massachusetts and the District of Columbia. The most recent, although a Carter victory, was close enough so that a swing of a few thousand votes in a couple of states would have changed the result If only a miniscule portion of 1972 Republican voters repeat their ballot of that year, Mr. Reagan would appear an easy winner. On the other hand, it would not take the loss of much of his 1976 support to erase President Carter's margin of four years ago. The President's task, in other words, seems marginally more difficult than that of his opponent. – – In our analysis, we found it convenient to divide the country into three regions. The first – shares mostly in excess of 60, and 125 of the 129 votes went for President Ford in 1976. With ,- the possible exception of Oregon, these votes should be safe for Reagan in 1980. The second region is the Northeast/Midwest which contains the historic swing states where elections are deter- mined. It went to President Carter in 1976 by 160 votes to 104, these 56 votes, interestingly enough, being precisely his margin of victory. In most cases, however, his winning percentage was small. The most interesting region of the three, by far, is the South. It possesses 145 electoral votes. Every one of these went to Mr. Nixon in 1972 by margins ranging from 63.6 to 79.9, generally the largest winning margins he was accorded. Yet every one of these states, save one, swung to Mr. Carter in 1976. But for the fact that President Carter was born in Plains, Georgia, this letter would probably today be discussing President Ford's reelection prospects. To win, President Carter must both retain his hold on the South and preserve or increase his 1976 margin of victory in the Northeast/Midwest. 1972 results, along with the polls, suggest that the former willnot be an easy task. The latter is more possible, but a few votes either way could indeed change the result. It is possible to envision two scenarios based on each of the past two elections. In both arios we assigned the electoral votes ranked by the polls as just about certain, to their respective candidates, 152 votes to Governor Reagan and 99 votes for President Carter. If, in other states, Governor Reagan is able to repeat the 1972 Nixon vote, less 19, he will win, 275 electoral votes to 263. This scenario awards him such Southern states as Texas, Florida, Maryland, Alabams, Kentucky, and South Carolina, and he is the victor despite losing Illinois, Michigan, New York, Ohio, and Pennsylvania. In the alternative scenario, based on the 1976 vote, a swing of only 2 from the 1976 Carter tsliy is envisioned in fsvor of Governor Reagan. This produces a 284-254 electoral vote win for Governor Reagan. In it, he gains no state in Carter's Southern stronghold except Missisippi. He does, however, pick up Ohio and Wisconsin in the Northeast/Midwest, and retains those North- east/Midwest states which President Ford won in 1976. Texas, Pennsylvania, or Florida could be conveniently substituted for Ohio with the same results. In summary, Governor Reagan appears to have a wider variety of gain opportunities than does the President. This is, at best, a weak rationale for a forecast, but since the polls resoloutely refuse to predict a winner at this point, we will abide by it. Dow-Jones Industrials (1200 PM) 919.62 S & P Composite (12 00 PM 126.75 Cumulative Index (10/30/80) 986.45 ANTHONY W. TAB ELL DELAFIELD, HARVEY, TABELL AWTsla No statement or C!xpresslon of opinion or (lny olher mottcr herein contolned 1, or IS 10 be deemed to be, dIrectly or ,nd,rectly, an offer or thl! sol,c,tot,on of on offer to buy or sell any security referred to or mentioned The matter IS presented merely for the convellence of the subscriber While oNe believe the sources of our information to be reliable, we ,n no way represent or guarontee Ihe accuracy thereof nor of the statements ml,lde hereIn Any actIon 10 be token by the subscriber should be based on hIS own fnvestlgatlon and InformatIon Janney Montgome'y Scali, Inc, as a corporatIon, and lIs OffICI!rS Or employees, may now have, Or may later lake, pos1tlons or trades In respect to any securttles mentIoned 111 Ih,s or any future Issue, and such poslllon may be dIfferent from any vIews now or hereafter expressed 111 th15 or any other lSue Janney Montgomery Scott, Inc, whICh ,s regIstered WITh the SEC 05 on Investment adVisor, may gIVe adVICe to Its 1I1vestmen! adVisory and other customers Independently of any statements mode In thiS or 111 any other Issue Further InformatIon on any security mentioned hereIn IS aVaIlable on request

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