TABELL-S MARKET LETTER 600 ALEXANDER ROAD, CN 5209, PRINCETON, NEW JERSEY 08543-5209 MEMBER NEW YORK STOCK EXCHANGE, INC MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC 1609) 987-2300 October 9. 1H87 – – Sho-rt-term-forecasts.-Blthough-it-is amusing to Indulge In th;m. often -ha'v-;-;; wayf pro-;'ing embarrassing. Last week we pointed out that the Dow. since September, had spent the bulk of Its time in an approximate range between 2500 and 2600. We proposed the concept that this area might constitute 8 base. the result of which could be a test of the late-A ugust highs. A test indeed dId ensue this week. but it was 8 test of the low rather than the high. as the index on Thursday dropped to around the 2500 level prior to 8 closmg rally. A further test of that level was underway on FrIday morning. Despite the embarrassment, our inclination at the moment is to hang in there with the expectation that the August peaks will be further tested. We have taken note in this space of the mternal weakness suggested by a number of macromarket indicators. but patterns on indiVIdual stocks still seem to argue against an immediate. severe fall. Even at the worst levels of the week. relatively few downside breakouts seemed to be taking place. WIth all the eXCItement engendered by last week's gyrations. such as Tuesda y's 91-point drop. one obscure sta.tIstic may have been lost in the shuffle—the fact that the NASDAQ IndustrIal Index reached 488.92 on Monday. That figure. interestingly. is a new, ali-time high for that average. J2500 2300 2100 1900 J700 -1 1SQ') 500 !300 ! tOO 450 400 9DD OW JONES INDUSTRIAL AvERAGE DO ole INlJU51R1RL SOD Te / OJIR 100 This fact can barely be perceived in the upper, right-hand corner of the chart above, but it may still possess some significance. The Dow. we ali remember, topped Qut at 2722.42 on August 25. However. the NASDAQ Industrials continued to rise for another four days and reached 484.5 on August 31. Both indices bottomed On September 21, but the decline for the DJIA was twice that of the Junior index, 8.43 versus 4.19. This. in turn. was followed by the new peak in the OTC mdicator on MondilY. Now there is no clear mdication in the action so far that OTe issues have reversed their underperformance vis-a-vis blue chips shown by the OTC/DJIA ratio. the third line down on the chart. Yet one could have bought the OTe average at year-end, 1986 and done just as well as with the Dow to date. We have just been through what may be the only nine-month period since June. 1983 about whiCh such 8 statement could be made. The OTe peak in that year was 408.4, and the index at last night's close was only 15 above its 1983 high. Over the same period the Dow had appreciated some 102. There is here. in other words. 8 possibility of a significant relative strength reversal for secondary issues, those largely composing the OTe index. Such a swing, if it persists, would indicate a shift of leadership in the direction of 8 relatively unexploited group. It is possible to make this statement even While being less than sanguine over the general-market outlook. It does not require too long a memory to recall 1976 – 1978. when the Dow dropped from 1014.05 to 742.12. 8. 26.8 decline. The most astonishing fact regarding this perIod was that the OTe index was 10 higher at the end of it than at the beginning. Not-too-long-ago history, therefore. could wind up repeatmg itself. ANTHONY W. TAB ELL AWTebh DELAFIELD. HARVEY. TAB ELL INC. Dow Jones Industrials 0200) 2513.71 S P 500 (1200) 31491 CumulatlVe Index (10/8/87) 3939.13 No statement or expression of opinion or any other matter herein contained IS, or IS 10 be deemed 10 be, dlrecllyor Indirectly, an offer orthe solicttatlor'l of an offer to buy or sell any secunty referred to or mentioned The matter IS presented merely for the convenience of the subSCriber While we believe the sources of our InformallOn to be reliable, we In no way represent or guaranlee the accuracy thereof nor olthe statements made herein Any action to be taken by the subscnber should be based on his own investigation and Information Delafield, Harvey, Tabe!! Inc, as a corporallon and Its oHlcers or employees, may now have, or may later take, positions or trades In respecl to any ecunhes mentioned In Ihls or any hllure Issue, and such pOSltlon may be dlfferen! from any views now or hereafter expressed In thiS or any other Issue Delafield, Harvey, Tabelllnc, which IS reglsteredwlththe SEC as an Investment adVisor, may give advice 10 liS Investment adVISOry and other customers Independently of any slalemenls made In thIS Or In any olher Issue Further Informa1lon on any security mentioned hereIn IS available on request

'1l&\lIHE 11..11..'S &\1Rl 1E'1l n..1E'1l'1l IE IRl 600 ALEXANDER ROAD, eN 5209, PRINCETON, NEW JERSEY 085435209 MEMBER NEW YORK STOCK EXCHANGE, INC MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC (609) 9872300 October 16. 1987 The stock market, in thIS week's action. once again reminded us that it is not all peaches and cream and permanent profits. A 95-point decline on Wednesday was followed, yesterday. by a 57-point plunge. a .-drop perhapseven more l'rightening since-mose of-iew8scompressea-Tnlo-thelas1 half–hour — —– of trading. At Thursdays close. the Dow was down 13.5, the severest decline since November, 1983 July. 1984. That drop of 15.6, however. was a good deal less steep than the present one, since it lasted 164 trading days versus only 36 trading days so far for the current downswing. which, at this writing. appears still to be underway We do, honestly. hate to keep carping on this subject, but the one-day decline on Wednesday and the two-day decline ended yesterday were nowhere near the largest on record if measured properly in percentages rather than points. Wednesday's one-session fall of 3.81 has been surpassed by no fewer than 111 previous single-day drops since the modern Dow Jones Average was first computed. The two-day drop. 6.1. has been exceeded 75 times in the same timeframe. Furthermore. the most recent instances of one and two-day drops greater than the present one should be within the memory of most investors. having oecured just over a year ago on September 11-12, 1986. It is, furthermore. not necessary to resort to meaningless figures such as point-declines. since, in terms of being unusual. recent action can stand on its own two feet. Although, as we noted above, this week's fall has been exceeded many times in the past. the bulk of these cases occurred prior to World War II. As we have tried to demonstrate many times in the past. this history is largely irrelevant today, since markets of the 1920's and 1930's were uniformly a great deal more volatile. There have been only four single-day drops greater than Wedensday's since 1950 and only fourteen of approximately the same magnitude (greater than 3). Likewise, there have been only three two-day declines exceeding the current one since the 1950's and only eleven of the same approximate magnitude. This fact, by itself. should tell us something, since we are able to go back and observe the aftermath of past similar declines. Most of them. we are happy to report. occurred around important market bottoms. In some cases, the bottoms could be associated with the end of a major bear market (May 28, 1962 and May 25. 1970). In other instances. large one- and two-day drops were reactions to – – —-unexpectedevent-sl1eKorean Wlirin9'501mmh1)wer–ITearL aLL8cn4.955)-;–Sinue-the–d-rop'– so far, over 13. qualifies as intermediate-term in scope. it is necessary to give some thought as to how and when it might reach a bottom. As we have suggested in this space in the past, recent major lows have demonstrated characteristics quite different in today's institutionally-dominated market from those in previous past markets where the bulk of the trading was accounted for by individuals. In those olden days, a selling climax—consisting of a day or two of precipitous decline followed by a sharp recovery, both on heavy volume—was the normal indication of a bear market's end. However. the last such classic climax occurred in March, 1980, and the last at a major bottom was in May, 1970. More recent plunges—such as 1982. and 1984, and even. to a degree 1974—have terminated with downside exhaustion followed by unusually sharp upside action. Part of the difficulty at the moment is deciding what sort of bottom we are looking for. To some degree, the action of the past couple of days suggests that we may be seeing climactic action for the first time in seven years. Thursday's volume of 263 million shares was important, not because it was the fourth highest in history (the three higher volume days having all occurred this year), but because it was some 50 above the most recent average—which average we compute using the prior 25 days. This level has indeed been associated with some lows in the past, but more important bottoms have generally occurred when volume spurted to twice its recent average. Likewise, the 1400 plus issues that declined on Wednesday and Thursday were about 70 of all issues traded, versus the 80 level which has tended to characterize climactic bottoms. By contrast. if the bottom for this market is to conform to the most recent specimens, one would expect that downside action will, eventually. simply run out of steam. and. as was the case in September. 1986, whatever low is reached will be marginally tested. We suspect that one or the other forms of market reversal will take place not too far from current levels and in the not-toa-distant future. The major averages have all reacted to important support levels. these levels being delineated by the highs reached on April 6, 1987. the subsequent lows, achieved in mid-May. and the June breakouts which produced to the current advance. This support area exists at 2405 – 2215 for the Dow. For the S & P 500. it is between 302 and 278. In the case of the Dow Transports the support range is 961 – 908. We think. in other words, that the support levels mentioned above should. minimally, produce breathing space which can be used to assess whether or not a true reversal has taken place. Needless to say, we expect this sort of analysis to be the theme of this letter over the next few weeks. ANTHONY W. TAB ELL DELAFIELD. HARVEY. TAB ELL AWTebh Dow Jones Industrials (1200) S & P 500 (1200) Cumulative Index (10/15/87) 2342.20 294.60 3763.01 No statement or expression of opinion or any other matter herein contained IS, or IS to be deemed to be, directly or Ind'rectly, an offer or the solicitation of an offerto buy or sell any secUtity referred to or mentioned The maner IS presented merely for the convenience of the subscnber While we beheve the sources of our Information to be rellabte, we In no way represent or guarantee the accuracy thereof nor of the statements made herein Any action to be taken by the subscriber shoutd be based on hiS own investigation and information Detafletd, Harvey, Tabelt tnc ,as a corporation and Its officers or emptoyees, may now have, or may tater take, positions or trades 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 Delafield, Harvey, Tabell tnc , which IS registered W1th the SEC as an Investment adVISor, may give adVice to ItS Investment adVIsory and other customers Independently of any statements made In thiS or In any other Issue Further information on any security menlloned herein IS available on request

V Lii.\EDIED..D..S Lii.\ IRl IEV D..IEVVIEIRl 600 ALEXANDER ROAD, CN 5209, PRINCETON, NEW JERSEY 085435209 MEMBER NEW YORK STOCK EXCHANGE INC MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC (609) 9872300 October 23, 1987 —-A-few randomthoughts'On-being-present at- history, -'- – ,- -.-,–We have, in the past, castigated some of our 'colleagues for meslfuring declines in terms of points, so as to equate what were essentially minor downswings with the granddaddy of all market crashes—1929. This subterfuge is no longer necessary. The market managed to shatter, last week, most of the records achieved 58 years ago. Monday's 500-point drop in the Dow took it down 22.61, almost twice the 12.82 of October 28, 1929. The 26.17 fall over Friday and Monday was a tWO-day record, bettering the October 28-29, 1929 drop, 26 to 23. Only one 1929 mark appears intact. The entire drop from September 3 of that year through November 13 took the average down 47.87 in 56 trading days. The fall from August 25 through October 19 of this year has been, so far, only 36.15. Our initial feeling early this week was the amazement at the fact that, during the debacle, life seemed to go on. The magic year. 1929. had been drummed into our consciousness for so long that we expected everything to come to a screeching halt. Network anchormen, however, seemed uncomfortable with being required to treat the market's fall as a lead story and moved quickly along to Bernard Goetz, the Persian Gulf, and the World Series. There must have been, in 1929, some discussion of such unrelated items as the Philadelphia Athletics' comeback from an 8-0 deficit against the Cubs in the fourth game of that year's series. If- there are any minor beneficial side effects of the collapse, one such might be the stamping out of one of the more exotic weeds lately transplanted from the groves of academe to Wall Street. This is the hypothesis that markets adjust instantaneously to all known information. We would welcome knowing just what piece of information it was that emerged over last weekend and made stocks worth, on Monday, only four-fifths of their Friday price. And let us. for heaven's sake. forget the trade deficiC Blaming the decline on that news is akin. in the words of the late Red Smith, to blaming the Johnstown flood on a leaky toilet in Altoona. If cause is neeIe.!l, it is our own h)Cpothesis that the drop constitutes a failure on the part of the market mechanism we have allowed to accrue over recent years. Another recent —–.– import from the graduate schools has been the financial community's love affair with derivative products and their application to esoteric techniques such as portfolio insurance, which may be simply defined as an investment approach based on the premise that there is such a thing as a free lunch. The realization that derivatives may, indeed, be a destabilizing force emerged in many quarters this week, and we are inclined to agree with it. Returning to market history, one point, we think, deserves emphasis. This is that the phenomenon popularly referred to as 1929 really consists of two largely unrelated events which took place over a much longer timespan. The first is the market collapse which took place between September 3 and November 13 of that year. This phase, unpleasant though it was, was probably unavoidable, and indeed was followed by an almost-50 market rally. It is What occurred afterward that remains in most people's memory when the events of 58 years ago are recalled. This was the emergence of the Great Depression, which carried the market down slowly, on ever-diminishing volume over a period of more than two years, to a level 90 below the 1929 highs. The truly tragic part of the collapse ended, not with a bang in 1929, but with a whimper in 1932. Most authorities, it must be noted, feel that the second phase was not inevitable, and we would contend that this also applies to today's market. Against this background, it is necessary to offer some thoughts as to the future. Explosive as it was, we can and should place this week's action within a conventional, technical-analysis framework. What we witnessed between Monday and Wednesday was, quite simply, a selling climax—bigger, perhaps, than like events which have preceded it, but a selling climax nonetheless. Two of the characteristics of such a climax are a sharp decline on record volume and a SUbsequent rise on approximately equal volume retracing an important portion of the loss. This certainly describes last week's action, and it may well be that the rallying phase ended on Wednesday afternoon. The last part of a climax bottom is. generally, a test of the previous low, quite often, but not always, involving a new low not too different than the initial one. Such a test could occur, we think, within the next one to three weeks. If it does, it will, however agonizing, constitute an opportunity. The above covers only the short-term. It is, we think, impossible to assess the longer-term outlook at this time. We noted above, our feeling that 1930-32 was not an inevitable result of the 1929 crash. The next year will tell us how well we have learned the lessons of history. ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL INC. AWTebh Dow Jones Industrials (12 00) 1948.11 S & P 500 0200) 250.39 Cumulative Index (0122187) 3135.75 No statement or expresSIOn of opinion or any other matter herein contained IS, or IS to be deemed to be, directly or indirectly, an offer or the solICitation of an offer to buyor sell any security referred to or mentioned The matter IS presented merely for the convenience of the subsCriber While we beheve the sources of our InformalJon to be rehable, we In no way represent or guarantee the accuracy thereof nor of the statements made herein Any action 10 be taken by the subsCriber should be based on h,s own InvesbgallOn and Informabon Delafield, Harvey, Tabell Inc , as a corporation and lIs officers or employees, may now have, or may later take, poslllons or trades In respect to any securrtles mentioned In thiS or any future Issue, and such positIOn may be different from any views flOW or hereafter expressed In thiS or any other Issue Delafield, Harvey, Tabell tnc, which IS registered wrth Ihe SEC as an Investment adVisor, may give advice to Its Investment adVISOry and other cuslomers Independently of any statements made In th,s or In any other Issue Further ,nformatlon on any secUrity menlloned herein IS available on request

11&\ISHEL L S Rl IEII LIETII IE R 600 ALEXANDER ROAD, CN 5209, PRINCETON, NEW JERSEY 08543-5209 MEMBER NEW YORK STOCK EXCHANGE, INC MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC (609) 987-2300 October 30. 1987 Last week's market action can truthfully be defined as routine. This, of course, IS not true in any historical–sense…—Howev.er …..considecing the extraordinarynatur9C thewek wbich ppeceded them. of -the past five days, with their still wide. but less extreme, swings, lie well within th– range – — normal expectation. We noted, 8 week ago, that a test of the lows following an identifiable selling climax was 8 normal feature of climactIc bottoms. We stated further that there exists no hard-snd-fast rule to determine whether or not such a test need involve new lows below the climax bottoms. That particular dilemma still faces us. The Dow had a closing low this Monday at 1793.93 compared with a week earlier close of 1738.74. Wednesday's intra-day bottom of 1767.74 this week was well above the October 20 intra-day nadir of 1616.21. Whether this can be considered a successful test remains moot. We continue to feel that 8 new low remains 8 possibility. although Thursdays and Friday's strength, especially in the light of unfavorable news from abroad, must be acknowledged 8S impressive. Last week. in discussing market action for fall. 1987. we compared it with that of 1929. pointing out that most measures of recent trading exceeded records which had been set 58 years ago. It has been suggested by many analysts, notably Irving Kristal in Wednesdays Wall Street Journal, that a 1961-1962 comparison would be more apt. A case for such 8 comparison can certamly be made. The 1961-1962 bear market was one of the few that has taken place totally without any associated business recession. It occurred simply because with the Dow at 24 times earnings, the market had reached an excessive valuation level. Simllar conditions, of course, have prevailed recently. At this summer's peak above 2700, pIe ratios and yields were in the same general area of overvaluation that they had attained in 1961. If current forecasts are to be believed (and are not subject to later revision) a 1988 recession is it would seem, unlikely. From a technical point of view, 1929, 1962, and 1987 all possess typical selling-climax characteristics. The same point can of course, be made regarding dozens of other climax lows. We prefer, however, to equate 1987 with 1929 for one very simple reason. They were bigger. Equating the recent drop with any collapse other than 1929 is like comparing a housecat to a lion because they – —- –arflboth-oatsS.——————————————————– The recent drop and 1929-1930 are addItionally alike, in our view, in that they can both be associated with internal market structures which became untenable. In 1929 we learned, by way of 20/20 hindsight. that the villain was excessive stock market credit. Our hypothesis at the moment is that the same case could be made for this year although a more convoluted situation currently exists. The new factor which has entered the 1987 market equation has, of course, been the widespread use of futures contracts. Such contracts require as little or less margin than stocks required in 1929. At least two sets of participants in futures markets can, it seems to us, contribute to market volatility. One such set comprises floor traders, whose time horizon can be measured in minutes. The second such class consists of portfolio insurers, who, by definition, tend to sell on drops and buy on rallies. Futures markets, of course, are linked with stock markets via arbitrage (we use the word in its original sense) transactions carried out by program traders. In our view such traders have been unfairly blamed for the late crash, since they act simply as a conduit between the stock and futures markets. In simply taking advantage of intra-market spreads, they are no more culpable than the pedestrian who, perceiving a 100 bill lying on the sidewalk bends over to pick it up. The above is, of course, only a hypothesis. Autumn, 1987 will it is safe to say, be examined as no other market has been examined before. We will, at some time in the future, know a great deal more about who, in those tumultuous days, was doing what to whom. It may be that such a study will suggest relatively simple changes in trading mechanisms which could eliminate the apparently destabilizing force engendered by futures trading. One thinks, in this connection, of the now-almost-forgotten triple witching hours, which have effectively dIsappeared with the change from closing to opening settlements. There is here—we have said it before and will be saying it again—no suggestion that the similarity of the past fortnight's technical action to that of October-November 1929 necessarily indicates an aftermath similar to 1930-1932, which was, of course, when the real damage was done. It is devoutly to be wished that the lessons of 1929 have been adequately learned. We must admit our confidence in this regard has been slightly damaged by what seems to be total absence of questioning of current conventional wisdom which rails against the evils of the budget deficit and preaches the necessity of its immediate elimination. We were encouraged to learn. via the front page of Wednesday's New York Times, that a fair number of economists share our skepticism in this direction. However, the thought that deficit reduction which would indeed have been a proper policy in the early 1980's, might not be the correct prescription for 1987-1988 has, apparently. not crossed the minds of any of our 100 senators and 435 representatives. This is a subject we intend to discuss further in future issues. ANTHONY W. TABELL DELAFIELD. HARVEY. TABELL INC. AWTebh Dow Jones Industrials (12 00) 2002.82 S & P 500 (1200) 252.32 Cumulative Index (10129187) 2938.94 No statemenl or expression 01 opInion or any olher matter herein contained IS, or IS to be deemed to be, directly or Indirectly, an offer or lhe soliCitation of an offer to buy or sell any secUrity referred to or menlloned The matter IS presented merely for the convenience of the subSCriber While we believe the sources of our Information to be reliable, we In no way represent or guarantee the accuracy thereof norof the statements made herein Any actIOn to be taken by the subscnber should be based on hiS own Investigation and informatIOn Delafield, Harvey, Tabelllnc, as a corporallon and ItS officers or employees, may now have, or may later take, posItIOns or trades In respect to any secuntles mentioned In thiS or any future Issue, and such pOSitIon may be dlHerent from any views now or hereafter expressed In thiS or any other Issue Delafield, Harvey, Tabellinc , which IS registered With the SEC as an Investment adVisor, may give adVIce to Its Investment adVISOry and other customers Independently 01 any statements made In thiS or In any other Issue Further InformatIOn on any securrty mentioned herein IS available on request

TABELL'S MARKET LETTER 600 ALEXANDER ROAD, CN 5209, PRINCETON, NEW JERSEY 08543-5209 MEMBER NEW YORK STOCK EXCHANGE, INC MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC 1609) 987 -2300 – November 6, 1987 In our last two letters, following what has come to be called the meltdownll of October 19th, anaJc;gfes. we we discussed at some length the comparison between that collapse and two prior climax bear markets. and grea-C— —- -Fall, –1929an(fSpring,196f.'–Thetwo (reefy-admIt; are not prop-r-ietary-, Ii many commentators have noted them, usually citing 1929 If they are bearish and 1962 if optimistic. We are perfectly content to see this sort of comparison being widely noted. It suggests that the technician's creed, which states that market history has something to tell us is becoming increasingly accepted. The chart below compares the first 200 days of the 1929 and 1962 markets, together wlth 197 action through yesterday. The two previous downswings are adjusted to a base of 2722.42, the August 25, 1987 high for the DJIA. The base dates used were the actual high date of the 1929 bull market and a secondary Dow high in March, 1962. – 'i(;we'..vr.t.if i \0 I.,' \ ' \ DOW JOES INDUSTRIQL RvERRGE ;(15 S!' 3 1!2el-Q-J B1I5E. MRRCH 15 19G21–) ,,,., ;-l/V/ — – \\ \0 \(\1\\y\ (\/\,,,,,1../J'-\J\.,/.\Vl,//\vj/' – \j — . – a A close examination of the chart reveals a number of similarities between the three examples. Each started with an initial decline, from 2722.42 on August 25th in the present case to 2492.82 on September 21st. Comparable declines can be singled out for the two earlier periods, a 5.46 fall in 1962 over 22 days and a much steeper 14.7 drop taking 20 days in 192Q. Each market recovered somewhat and then embarked upon its final, selling-climax plunge. As we have noted. the free falls of 1929 and 1987 were quite similar. Last month the Dow fell 34.1 over eleven days versus 34.8 over fifteen days in 1929. The 1962 drop, as the chart clearly shows. was much less severe, reaching an equivalent of only 2170. It is the aftermath of both prior declines which is of interest. Both. as the chart shows. subsequently penetrated their climax lows. The relatively constructive action of the past two weeks suggests that this may not be the case this time. but it certainly remains a possibility. However, once the secondary low was reached. action was reasonably positive, although interrupted in 1962, by the Cuban missile crisis in October. As we have said before. however. the chart to us seems to suggest that it is folly at this early stage to tie oneself to an inflexible forecast. What will be needed is continued analysis of the 1987-88 pattern which should. our chart suggests, continue to unfold without too great a variance from current prices. We should, after some time, have a clearer idea of whether that pattern is leading to something like the bull market of 1963-66 or an ongoing drop such as that which followed the April, 1930 high. ANTHONY W. TAB ELL DELAfIELD, HARVEY, TABELL INC. AWTmjs Dow Jones Industrials 01/5187) 1985.41 S & P 500 (1115187) 254.48 Cumulative Index (11/5/87) 3113.57 No statement or expressIOn 01 op!mon or any other matter hereIn contaIned IS, or IS to be deemed to be, dIrectly or IndIrectly, an offer Of the sohCltatlon 01 an offer to buy or sell any secunty relerred to or mentioned The matter IS presented merely tor the COflvemence of Ihe subSCriber WhIle we beheve the sources of our informatIon to be rehable, we In no way represent or guarantee the accuracy thereof nor of the statements made herein Any action 10 be taken by the subSCriber should be based on hiS own Investigation and information Delalleld, Harvey, Tabel! Inc, as a corporation and tls officers or employees may now have, or may later take, poSitions or trades In respect to any securities menlloned In thiS or any future Issue, and such pOSl\lon may be drtferent from any views now or hereafter expressed tn thiS or any other Issue Delaheld, Harvey, Tabellinc , which is registered wtlh the SEC as an Investment adVisor, may give adVice to ItS Investment adVISOry and other customers Ifldependently of any statements made In thiS or In any other Issue Further information on any secUrity mentioned herein IS available on request

VIEUEILIL'S IRlIEV ILIEVVIE 600 ALEXANDER ROAD, CN 5209, PRINCETON, NEW JERSEY 08543-5209 MEMBER NEW YORK STOCK EXCHANGE. INC MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS. INC (609) 987-2300 November 13, 1987 Technical market action for the past week can. from a short-term point of view at least. be 1–'-' —regardedas constructive.—Kl-ilslowest'levels.- aroui1d1860 bnTuesaay.the'Dow haareach-ed the downside objective of a small top around the 2000-1950 area. It rebounded a number of times from that level and then moved up, postin'g a modest rally on Wednesday. and a somewhat more impressive 60-point rise in yesterday's trading. It remains unclear just where this short-term picture fits into a still vague intermediate and longer term outlook. While awaiting resolution of this dilemma. we would like to share with our readers a concern which has previously been articulated in this space. That concern is with the current budget deficit. However. unlike Just about everyone else in the world with the exception of a few lonely economists of varying stripes, we are not worried about the deficit's being too high. We fear that current efforts to reduce it may. in fact. be untimely. This suggestion. in today's climate, smacks of heresy. and we should, therefore. clarify our point of view. We are most emphatically not asserting that budget deficits are. in principle. a good thing. Nor are we asserting that recent deficits. which have been fluctuating around the 200 billion level since 1982, constitute a prudent way to manage the economy. We fully agree that U.S. Government debt, now over 2 trillion, should never have been allowed to reach its current level. We are simply asserting that, for 1988-89, it might be proper for the powers that be to spend less time on the deficit, rather than engage in what seems to be a competition to determine how closely politicians. especially those up for reelection in 1988, can equate deficit reduction with motherhood and apple pie. We have, actually, not done too badly so far by taking no overt action with regard to the deficit. It must be recalled that the deficit now the subject of bickering between the White House and Congress is a projected figure. When we look at real numbers, 'we find that the actual deficit has declined in each of the past four quarters and has. in the process, been reduced by an approximate 90-billion annual rate. We are not all that sure that continued benign neglect will not produce slJ11ilar success. Our readers know that we have. in this space, drawn parallels between market action in the late 1980's and that of the late 1920's. We were forced to drag out this comparison once again when this month's market colla,p-seescalatedintoonethat could.–.legitimately .becompared onlywiththe crash of October, 1929. However, we have always noted, in discussions of 1929, that we regard the stock-market collapse of that year as an event separate from the depression of 1930-1932. It can and has been argued that the stock market provided a trigger for that economic contraction, but, subsequent to the 1930 rally, we are convinced the market was mirroring the economy rather than the other way around. The task, then, is to avoid the mistakes of that era. However, when one reads a history of 1930-1932, the political tub-thumping sounds strangely familar. In his budget messages of 1930 and 1931, President Hoover voiced alarm regarding projected deficits At the same time, the 1932 Democratic platform was calling for a balanced budget. At the very bottom of the depression. in 1932. the Treasury Department recommended a sharp rise in the personal income tax. On the monetary, as opposed to the fiscal, front, the money supply in the early 1930's was allowed to drop some 30. an event Milton Friedman has characterized as being central to the depression. Part of the reason for this contraction, however. was the failure on the part of banks to lend the reserves that the Fed attempted to supply. Dr. Friedman has noted, as long ago as 1954, that the tools the Fed now has at its disposal are sufficient to make America depression-proof. He indicated last week that he still holds this view. If, however, the very fact of the stock-market drop causes a private spending contraction, and that contraction is accompanied by deficit reduction efforts. either increased taxes or reduced spending, we wonder whether the Fed will summon up the courage to take the drastic measures that might be required. We wonder. in other words. if monetary policy can succeed in the environment of a fiscal policy dIrectly opposed to it. The monetarist answer would be that it can. However. a great deal depends on this theoretical prediction being correct. This view is shared by disparate classes of economists. One such group consists of unreconstructed Keynesians, who believe in the primacy fiscal policy and the necessity of fiscal stimulus during a business slowdown. A diametrically-opposed group, supply-side economists, argues for the preservation of its flagship. 1988 tax reduction. Such reduction. if the Laffer curve is to be believed. could result in increased revenues rather than reduced ones. Support for this argument can be found in the deficit figures referred to above. It is not the intention of this letter to propose a particular economic point-of-view, but simply to note that there exists a reasonable case for aVOiding immediate. radical spending decreases and/or tax increases. This cautionary note, ultimately. seems to be falling unheeded on the ears of those members of Congress who will. unfortunately. decide the fiscal policies which will characterize 1988. Our concern is, at the moment, nothing more than that. It is most certainly not a prediction that 1988 fiscal action will bring about a depression or other prOblems of equal severity. It is simply something to keep in mind. given the current consensus projections of continued 1988 economic growth. ANTHONY W TABELL AWTebh DELAFIELD, HARVEY, TABELL Dow Jones Industrials (1200) 1942.80 S & P 500 (1200) 24793 Cumulative Index (11112187) 3089.80 No statement or expression of opinion or any other matler herem contained IS, or IS 10 be deemed to be, directly or Indirectly, an offer or the solicitatIon of an offer to buy or sell any secUrity referred to or menltoned The matter IS presented merely for the convenience 01 the subscriber While we beheve the sources 01 our Information to be reliable, we In no way represent or guarantee the accuracythereol nor 01 the statements made herem Any acilon to be laken by the subscriber should be based on his own Investigation and mformatlon Oelafleld Harvey, Tabelllnc, as a corporation and lis officers or employees may now have, or may later take, poSitions or trades In respect 10 any secuntles mentioned In thrs or any future Issue, and such position may be different Irom any views now or hereafter expressed In thiS or any other Issue Delafield, Harvey, Tabellinc , whICh IS registered with the SEC as an Investment advisor, may gIVe adVice to Its Investment adVISOry and other customers mdependently of any statements made In thiS or In any other Issue Fur1her mformabon on any security mentioned herein IS available on request

TABELL'S MARKET LETTER 600 ALEXANDER ROAD, CN 5209, PRINCETON, NEW JERSEY 08543-5209 MEMBER NEW YORK STOCK EXCHANGE, INC MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC (609) 987 -2300 November 20, 1987 Long-time readers of this letter will be aware of our penchant for quoting the famous paragraph alludes-tothe'–fromtne SherlocKHormes story. Sliver -Blaze.lnwhich thegreatdetect1ve- curious ——- incident of the dog in the night time. The background for this is that a valuable horse has been stolen from a stable. Watson points out that the stable dog did nothing in the night time, and Holmes rejoins, that was the curious incident. Holmes has deduced from the dog's not barking that the culprit was one known to him. Unlike most ordinary mortals, Holmes has been able to glean useful information from the failure of an event to occur. We are fond of this quotation for reasons that go far beyond our own infatuation with the Holmes stories. There are many instances in the task of market analysis where it is necessary to observe what is not happening as well as what is happening. The present may be just such a case. The September – October collapse in equity prices bottomed, we all remember, at 1738.74 on October 19. Within two days it had regained almost 300 points to 2027.85. That has been the high so far. At today's close, 24 trading days since October 19 will have elapsed. We are entitled to ask whether or not this behavior is consistent with the hypothesis that October 19 will turn out to have been the actual low of the downswing. It is necessary to state, unfortunately, that such is not the case. The table below summarizes market behavior following fifteen dates which we know, by hindsight, to have been major stock-market lows. It includes the actual low dates of all downswings since 1929 which, in our opinion, can plausibly be identified as major cycle bottoms. The table summarizes action for the 100 trading days following each of these lows. For each 10-day bracket, it lists the number of days on which a new high was made either in the Dow Jones Industrials or in our breadth index. (The two indices are taken together, since it is a characteristic of many bottoms that breadth outperforms the Dow in the early stages.) For 1987, only the two days noted above qualify for inclusion in the table. Twenty-two trading days have elapsed since then without a new high in either indicator being posted and, absent the sudden emergence of a rather strong advance, it appears unlikely that such a high will occur during the near future. – ..-…..,. Date 1-10 11-20 21-30 31-40 41-50 51-60 61-70 71-80 81-90 91-100 Nov 13, 1929 7 5 5 51 4 4 Jul 8, 1932 8 10 8 4 71 Mar 31, 1938 6 2 1 37 4 5 Apr 28, 1942 9 2 5 5 222 7 Oct 9. 1946 5 1 3 31 28 Jun 13, 1949 7 8 7 6 3 31 6 4 Sep 14, 1953 8 5 8 7 1 4 1 2 10 6 Oct 22, 1957 4 4 2 7 51 2 Jun 26. 1962 8 1 2 6 1 4 Oct 7, 1966 7 7 4 1 10 7 5 May 26, 1970 6 1 21 42 6 4 Dec 6, 1974 7 6 5 7 745 52 Feb 28, 1978 9 4 3 8 353 Aug 12, 1982 10 5 5 3 831 1 Jul 24, 1984 9 3 4 3 22 Oct 19, 1987 2 No subsequent high through day 24 The table shows that, in contrast to the two lonely new highs posted SUbsequent to October 19, most previous lows saw new highs being scored on a majority of the first ten days of the subsequent advance. Five has been the lowest number of advances in the first 20 days, and the average number of new highs for the fourteen 20-day spans has been eleven. In the first 30 days of past bull markets, an average of fourteen new highs have occurred with the smallest number being six. Interestingly, 1929 and 1962, the two markets with which this one has most frequently been compared, saw initial lows followed by just two days of reversal, as is the case for the October 19 low so far. The October 29. 1929 low of 230.07 was followed nine days later by the ultimate low at 198.69. The low of May 28, 1962, at 576.93, was the precursor of the June 26 low at 535.76, There is, we suppose, some solace to be gained from the fact that 24 days have now elapsed without the present market's moving to a new low but this phenomenon would, we think have to go on for some time before it could be termed significant. There is. paradoxically, a bullish note implicit in all of the above. The new lows cited above all turned out to be major ones. It is quite possible that the same will be able to be said of any new low which might be chalked up over the near term. Such an occurrence, however, following the five-week surcease of the September – October battering might produce a difficult period in which to practice investment dlscipline. ANTHONY W. TAB ELL DELAFIELD, HARVEY, TABELL INC. AWTebh Dow Jones Industrials 0200) 1902.02 S & P 500 0200) 238.15 Cumulative Index (11/19/87) 3028.86 No statement or expression of opinion Of any other matter herein contained IS, or IS to be deemed to be, directly or indirectly, an offer or the sollcrtatlon of an offer to buy or sell any security referred to or mentioned The matter IS presented merely for the convenience of the subSCriber While we beheve the sources of our InformatJon to be rehable, we In no way represent or guaramee the accuracy thereof nor of the statements made herern Any action 10 be laken by the subscriber should be based on hiS own investigation and Information Delafield, Harvey, Tabellinc ,as a corporation and Its officers or employees, may now have, or may later take, poSllions or trades In respect to any seCUritres menlloned In thrs or any future Issue, and such pOSll!on may be different Irom any views now or hereafter expressed In thiS or any other Issue Delafield, Harvey, Tabelilnc , which IS registered With the SEC as an Investment adVISor, may give adVIce to lis Investment adVISory and other customers Independently of any statements made In thiS or In any other Issue Funher Informa\lon on any security men\loned herem IS avaIlable on request

TABELL'S MARKET LETTER 600 ALEXANDER ROAD, CN 5209, PRINCETON, NEW JERSEY 08543-5209 MEMBER NEW YORK STOCK EXCHANGE, INC MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC (609) 987-2300 . /1\ November 27, 1987 – — I t—should—come..r as's …surp-rise …tono-.onethat M a ctober,…198 7–achiev ed-an.o;.all-time….record-'-for..o..monthly — .,– market volatility, bettering by a comfortable margin the prior record 'set in November, 1929. However. this increase in volatility appears. so far at least, to be an isolated instance, and it remains unclear just what the implications may be. The chart below first appeared in this space in 1982, paradoxically enough in an effort to prove that the market WBS, at that time. not unusually volatile. The chart, quite simply, for each month from 1926 to date, measures the standard deviation from the mean of the daily log changes in the Dow for that month. Those familiar with statistics will understand the arcane language of the previous sentence. Others need only to know that a log change is similar to (but more accurate than) a percentage change and the standard deviation is simply a measure of variability. STRNDARD DEVIATION OF DRILY LOG CHANGES DOW JONES INDUSTRIRL AVERAGE MONTHLY 1926 – DATE lIiVft -r-,i.—r8–'.-,–,;grrTij.—r,,,,–,ij.-,–,;ij-rTrrT.—rrrri The October variability measurement (6.6 versus 4.9 for 1929) comfortably exceeds the prior record. In our view. however. uncertainty exists as to whether this constitutes a one-time aberration or whether it suggests a return to the sort of volatility which prevailed during the 1930's. It would be useful to know this. Since 1946. as the chart shows. volatility has tended to range between 0.5 and 1, with occasional spikes above L 5. These spikes have been useful as indicators of important market bottoms. They have occurred in seven instances over the forty-year period and. of the seven. six of these events happened around major lows. the most recent case occurring in August – November. 1982. If this tendency still ho1ds true. the October rating. four times the usual threshold, should be treated as a strongly bullish indication. If. however. we have-returned to volatility standards something like those of the early 1930's, the implications are quite different. If we accept a level of 3.0 or better as indicating unusual volatility during the 1929 – 1933 period. there took place eleven such occurrences. Three of them, indeed. were important lows. The first such low was November. 1929, preceding the sharp rally following the 1929 break which continued to April. 1930. The next was at the super-cycle low in June. 1932. and the third occurred in March. 1933. The eight other cases, however, all produced sharply lower prices. Measured over three months. the average decline was 23. and the largest drop. in early 1932. was 45. The questions raised by emerging wide variability have. it seems to us. implicatlOns for all facets of technical analysis. A majority of indicators we are currently accustomed to using would either have been useless in the 1930's or would have to be interpreted using very different parameters. A fundamental question exists and will continue to exist as to whether the extraordinary events of last month signal a new sort of market environment. ANTHONY W. TABELL DELAFIELD. HARVEY. TAB ELL INC. AWTebh Dow Jones Industrials (1200) 1942.64 S & P 500 (1200) 243.38 Cumulative Index (11/25/87) 3072.29 No statement or expression of opinion or any other matter herein contained IS, or IS to be deemed to be, directly or indirectly, an oHer orthe sohcltatlon of an oHer to buy or sell any seCUrity referred 10 or menlloned The matter IS presented merely for the convenience of the subscriber While we believe the sources of our informatIOn to be reliable, we In no way represent or guarantee the accuracy thereof nor 01 the statements made herelf\ Any action to be taken by the subscriber should be based on hiS own If\vesllgallon and InformatIOn Delafield, Harvey, labellinc , as a corporation and lis oHlcers or employees, may now have, or may later take, poSitions or trades If\ respect to 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 Delafield, Harvey, labellinc , which IS registered With the SEC as an If\veslment advisor, may give advice to Its Investment advisory and other customers If\dependently of any statements made In this or In any other Issue Further If\formatlon on any secunty mentioned herein IS available on request

TABELL'S MARKET LETTER 600 ALEXANDER ROAD, CN 5209, PRINCETON, NEW JERSEY 085435209 MEMBER NEW YORK STOCK EXCHANGE, INC MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC (609) 9872300 1 December 4, 1987 – -;– Whethr-.-Lor -!lot .it…J.s… true-'o-that….one …picture is worth ..athous.!!nd words,thechar.t below captures almost perfectly our conception the dilemma facing today's investor. It is a 20-point-unit, point-and-figure chart tracing the last two years' action in the Dow Jones Industrial Average. It shows, in other words, each 20-point change in the Dow from early 1986 to date. Also included are some dates for key points on the chart. ,;noo O1l.o II -I I01'500 diOO a!oo 11& daoo a,oo II t''''00 \SOO ,'00 fa II III , 1500 It is interesting, with the Dow having on Thursday again moved below 1800, how much water has passed under the bridge since that figure was first attained. This was in March, 1986, and the remainder of that year was spent, for the most part, between 1780 and 1900. As 1987 began, the market went on a New Year's binge and reached 2400 in April. Four months later, on August 25, the bull-market high, at 2722.42, was achieved. The following month and a half produced the innocuous pattern which existed on October 12, 1987. The formation was rather obviously a top, but it was certainly a plausible assumption that the support in the 2400 – 2200 area might contain any decline. The following week, culminating in Meltdown Monday, showed us how ephemeral that support really was. Following that low, a two-day rally to 2027.85, so far the post-October high, took place. This was followed by a decline to 1800, a second rise above 2000, and the recent lateral trading range between 2000 and 1880. That range has just been penetrated on the downside. Here, then, is the dilemma. A great deal of work has been done in just seven weeks. An immediate upside penetration would call for an objective of 2400 for the Dow. This would be a worthwhile rally but, at its end, all upside objectives would have been reached. On the other hand, if that seven weeks of action is to be considered a top, two interpretations are possible. The first, including only action since November 2, would suggest that nothing worse than a test of the October low was in the offing, a test possibly occurring as we write this. A more pessimistic interpretation would suggest that the top began on October 21, and an objective in the 1600 – 1550 range is a possibility. At this point, though, further problems arise. If new lows are projected, one must take into account the possibility that the action shown constitutes a massive head-and-shoulders top. We hasten to add that we do not feel, at the moment. that this is a plausible interpretation. Known problems—the budget, the deficit, and the third world—seem insufficient, at their present magnitude, at least, to confirm so radical a projection. However, while the odds are strongly against this interpretation, one cannot pretend that the risk is not there, and the market analyst would be abdicating his responsibility if he did not call attention to it. The ancient Chinese curse, May you live in interesting times. n, may have special meaning for the investor in 1988, as he attempts to sort out the aftermath of the October collapse. AWTebh Dow Jones Industrials Average (1200) S & P 500 (1200) Cumulative Index (12/3/87) 1761.93 224.86 2899.32 ANTHONY W. TAB ELL DELAFIELD, HARVEY, TABELL INC. –. No statement or expression of opinion or any other matter herein contained IS, or IS to be deemed to be, directly or indirectly, an offer or the soliCitation of an offer to buy or sell any security referred 10 or mentioned The matter IS presented merely for the convenience of the subscriber While we believe the sources of our Iniormatton to be rehable, we In no way represent or guarantee the accuracy Ihereof nor of the statements made herein Any acllon to betaken by the subscriber should be based on hiS own investigation and Information Delafield, Harvey, Tabelllnc, as a corporation and Its officers or employees, may now have, or may laler take, poSitions or trades In respect to any securles 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 Delafield, Harvey, Tabellinc , which IS registered wllh Ihe SEC as an Investment adVisor, may give adVice to s Investment adVISOry and other customers Independently of any statements made In thiS or In any other Issue Further Informa\lon on any secunty mentioned herern IS available on request

TABELL-S MARKET LETTER 600 ALEXANDER ROAD, CN 5209, PRINCETON, NEW JERSEY 08543-5209 MEMBER NEW YORK STOCK EXCHANGE, INC MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC (6091 987-2300 December 11, 1987 ThroughT..hursday 8fternoon—ofthisweek. at least.–t-he market was-able to-demonstrate – -mOderately improved performance. and it is at least arguable that a successful test of the mid-October lows was completed, Last Friday's close on the Dow—1766.74—was within 28 points of tile closing figure for October 19. A number of other averages, by the end of last week, had penetrated their previous lows, but. in almost all cases, by modest amounts. Depending on what average one chooses to look at, and whether the closing. intra-day, or hourly low is used, the statement can be made that a new low either was or was not achieved on December 4. In any case, all averages had declined, by that date, to the Vicinity of where they had been in mid-October. Immediately following this, on the first three days of tnis week, a fairly impressive sort of a rally took place. Over the three days, the Dow managed to tack on some 136 points. Although opening 50 points lower yesterday, the DJIA erased this loss and was ahead 15 points at mid-day. All this suggested that a successful test had taken place. The underlying momentum of the rise, however, left something to be desired. Breadth figures were considerably below their norm on the three rallying days, and volume failed to increase significantly. This latter statement is especially true when one adjusts for yet another complexity which has entered the current financial equation. That, of course, is the Japanese tax Jaw, which causes large blocks of high-yield stocks nominally to change hands around the ex-dividend date. Performing a rough adjustment on the past two weeks' volume to correct for this anomaly, it turns out that average trading levels for Monday, Tuesday, and Wednesday were about the same as they had been in the prior week's declining markets. This raises questions, since true reversals tend to be characterized by rising volume along with rising prices. A more important emerging characteristic of teday's markets is increased volatility. It is —–ironic that-we–shoul-d-bediscussing-thissubject-'sincej'for-some–twoars–whileheDowwa,;s,;—–1 making new highs, the popular press repeatedly discussed upward price moves in terms of points rather than, properly, in terms of percentage. We complained about this long and loud, and pointed out that, observed correctly, market volatility in the mid 1980's was not at all unusual. Meltdown Monday, however, changed all that. Since October 19, the market has, demonstrably become more volatile. Indeed. we have been somewhat blase about this. Thursday's action—with the Dow down 50 shortly after the opening, followed by a 65-point advance and the subsequent loss of just about the entire rise—seemed almost normal considering the experience of the past eight or nine weeks. One test of volatility, which we performed this week, involved extracting from our data base the 100 largest advances and 100 largest declines for a single day since the inception of the modern Dow Jones Industrial Average. As we all know by now, October 19 tops the list of declines with nothing else even close. The 22.6 percent fall is almost twice as great as that of October 28, 1929, and, in one day, almost managed to equal the two-day collapse of October 28-29 in that year. Moreover. no fewer than four one-day drops in the past two months managed to make the list. The 156-point drop on October 26 ranked sixth, and two other declines, on October 16 and November 30, qualify for inclusion. This compares to just four cases in the entire modern era—1949 to 1986, a period of 37 years, Seventy-four of the 100 declines occurred during the years 1929 to 1933. Thus, the market seems to be producing swings of a magnitude not common for almost 60 years. Analysis of record market advances tells, roughly. the same story. The 186-point rally on October 21 was the fifth largest rise in modern history, and two other recent rises—October 20 and October 29—a1so make the list. Like its downside counterpart, the list of 100 greatest advances is dominated by five years, 1929 to 1933, which produced 71 of the 100 cases. The question, of course, is what, precisely, we should make of all this. For the technician, life would be much easier if it were possible to dismiss it as a temporary aberration that will, eventually, go away. We are not all that sure, however, that this is the case. If we are entering a period when market moves must be compared to those of the early 1930's, rather than the more recent experience, a good many technical market parameters are going to have to be substantially revised. ANTHONY W. TABELL DELAFIELD, HARVEY, TAB ELL INC. AWTebn Dow Jones Industrials (1200) 1860.08 S & P 500 (1200) 253.34 Cumulative Index (12/10/87) 2909.43 No statement or expression of opinion or any other matter herein contained IS, or IS to be deemed to be, directly or Indirectly, an offer or the sohcltatlon of an offerto buy or sell any security referred to or mentioned The matter IS presented merely for the convenience at the subsCriber While we believe the sources of our information to be rehable, we In no way represent or guarantee the accuracythereo! nor of the statements made herein Any action 10 be taken by the subSCriber should be based on hiS own Investigation and mformaliOn Delafield, Harvey, Tabel! Inc, as a corporatIOn and Its officers or employees, may now have, or may later take, posrtlons or trades In respect to any secuntles mentioned In thiS or any future Issue, and such pOSlbon may be different from any views now or hereafter expressed In thiS or any other Issue Delafield, Harvey, Tabellinc ,which IS registered With the SEC as an Investment adVisor, may give adVice to Its Investment adVISOry and other customers Independently of any statements made In thIS or In any other Issue Further InformabOn on any secunty mentioned herein IS available on request