TABELL'S MARKET LETTER 5 VAUGHN DRIVE, CN 5209, PRINCETON. NEW JERSEY 08543-5209 MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS. INC (609) 987 -2300 October 11, 1991 One of the reasons for the market',s continued trendlessness over the past couple of weeks may be, it has been suggested by ' e analysts, G.qncem CR- the part .of moey agers 9yerthe.possibiHty of a seriou decline during the month ofOctober. Those- managers, it is reasoned, -recan, from legend at least, 'October, 1929, and they certainly remember, from bitter experienCe, Meltdown Monday', October 19, 1987. Even more recent, of course, is the UAL fiasco of Friday, October 13, 1989, which produced a 190-point drop in the Dow and no fewer than 1600 declining issues. While this may constitute powerful folklore, it may well be a misleading interpretstion of the historical record. A study of the Dow's changes for October, since it was first computed in 1897, fails to show any particular downward bias. The diastrous October of 1987 is not even the worst month in market histol)'. The Dow fell 23.2 in that month, but the record for the worst month since 1897 belongs to September, 1931 when the average fell 30.7. Slightly larger drops were also posted in March 1938 and April 1932. In addition, the 20.3 fall of October 1929 was slightly exceeded by the 21.7 decline in May 1940 in response to the fall of France. A look at the overall record for the 93 Octobers since 1897 actually shows more advancing cases than declining ones, 50 rises versus 46 falls. The average percentsge change for the month is, indeed, slightly negative, -I.12. However, three other months also negative average percentsge changes, all of them greater than the October figure. Two-month perioda ending in October do show the worst seasonal pattern for all such perioda, but this is largely due to the effect of September, of which more later. There is, perhaps, some cause for apprehension in the fact that large one-day drops seem to be concentrated in October, or, at least in the autumn in general. October 19, 1987 was, of course, the worst single day in stock-market histol)', and October 28 and 29, 1929 hold second and third place. The DnA has declined 5 or more on 52 separate occasions since 1926, and 15 of these declines, a rather large proportion, have token place in October. Nine such drops have occurred in September and seven in November. Some concern, therefore, about the general fall season may perhaps be appropriate. What is, in fact, especially interesting about the month of October is the fact that it is sandwiched between two months which do, in fact, possess especially significant and interesting seasonal patterns. As we have often noted in this letter, there does indeed exist a month with a particular downward bias, but that month is not OcU;ber, but September. The overall market, as we all know, possesses a slight but identifiable upward bias. That bias becomes more and more evident when one examines perioda of as long as a month. Of — —1131 market months-since-1897, 643 have-seen-the-Dow-move-upward,-and-only-488-have-seen-it-decline.-There-is,–therefore,a-51-T— chance that any given market month will be an upward one. The 94 Septembers on record through last month, though, have produced only 36 advances and 58 declines. Taking all of the 1131 montha, the average change for a given market month is plus 0.56 . For September, the average change has been minus 1.33 . Application of standard test of ststistical significance are applied to this phenomenon, one finds that the tendency in the direction of a declining September is the most significant, slightly edging out the oft- remarked phenomenon of the year-lnd rally. The seasonal pattern which may be of the greatest current practical use, though, is the one which involves November, since that month, in fact, lies ahead of us. By itself, November appears to be quite an ordinal)' month, having produced 56 advances and 37 declines m the DnA with an average rise for the month of 0.74. What is of interest, however, is the fact that November is the only month of the year which seems to possess some predictive value. We have no idea why this should be, but it is a manifeststion we discovered a few years ago, and we remain intrigued by it. We noted above that some 57 of all one-month periods were upward ones. We can of course extend this measurement to longer perioda of time, and the upward expectstion naturally increases. It is 60.9 for six-months and 62.3 for all twelve-month perioda. Let us contrast this with the record for all perioda following an upward November. For all period lengths from one month to one year, such periods have shown a greater expectstion of being upward than would be expected from looking at all periods of similar length. This difference is most striking for intervals of five to ten months in length and is most significant for eight-month periods. Taking eight months as an example, we find that, since 1897, 696 produced rising markets and 433 produced falling ones, thus producing an upward expectstion of 61.6. When we look at eight-month perioda following an upward November, however, we discover that 41 such perioda were upward ones, and only 15 were downward. The percentsge of upward periods, then, was 73.2, significantly higher than the expected 61. 6 figure. Similar results are seen when one looks at the average percentsge change for all eight-month periods following an up November. The norma! expectation for any such period would be a change of 5.08. However the average percentsge change for the 41 eight-month perioda after an upward November is almost twice as great, 9.05. November turned out to be a-good predictor in the most recent case, that of 1990. -It was an upward month with the-Dow posting a loo-point rally from 2442 to 2559. The eight months following this instance of an upward November ended, of course, on July 31st, 1991. On that day the Dow closed at 3024.82, 18.7 above its November close, an advance of approximately three times the norma! expectstion. As far as patterns for the fall season are concerned, then, there does exist some justification for looking for a sharp one-day decline this month, a decline which, we suppose, might manifest itself if a downside breakout from the eight-month-old trading range tokes place. Let us not forget, though, to look at the market's performance next month for a possible clue as to the sort of market climate we might expect in the first half of 1992. Dow Jones Industrials 2973.84 AN1HONY W. TABELL DELAAELD,HARVEY,TABELL S & P 500 380.00 Cumulative Index (10/10/91) 6297.40 No statement or expression 01 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 oHer to buy or sell any security referred to or mentioned The matter IS presented merely lor the convenience of the subscriber While we beheve the sources of our Information to be reliable, we In no way represent or guarantee the accuracy thereof nor of the statements made herein Any act!Qn to be taken by the subSCriber should be based on hiS own InvesttgatlOn and informatIOn Delafield, Harvey, Tabelllnc, as a corporatron and Its ofhcers or employees, may now have, or may later take posItions or trades In respect to any secUrities mentioned In thiS or any future Issue, and such poSitron may be different from any views now or hereafter expressed In thiS or any other Issue Delafield, Harvey, Tabelllnc, which IS registered wrth the SEC as an Investment adVisor, may give adVice to rts Investment adVISory and other customers Independently of any statements made In thiS or In any other Issue Further Information on any security mentioned herein IS available on request

TABELL'S MARKET LETTER 5 VAUGHN DRIVE, CN 5209, PRINCETON, NEW JERSEY 08543-5209 MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC (609) 987-2300 October 18. 1991 Wednesday's new high on the Dow. widely hailed in the press as evidence of newfound financial strength. was. 10 actuality. reaUYDothing.more than a.contInuation oLthesorLof-action themarkethas been exhibiting all-ye.ar. -It-was, in fact, the fifth in-a series of new Dow peaks. -;;ch oe a bit-high'; -;-h;' th;It. -Unfortunately. this new high was not all that different from the first of the series, scored on March 6th at 2973.27, a number that is a bare 2.89 lower than the one achieved this week. Typically, there was, on Thursday, no follow-through as the market, under the mfluence of disappointing inflation figures, retreated from its latest effort to move out of the 1991 trading range. There are a fair number of kmd words which can be said of the market's latest foray into all-lime high ground. Breadth failed to confirm. but only marglOally. and any future strength would undoubtedly produce new breadth peaks to go along with those m the Dow. As was widely mentioned m the press. all of the widely-followed indices of smaller stocks attamed new highs. This IS encouraging, in that it represents a distinct change from the small-stock underperformance of a year ago, but It was, in reality, nothing more than normally expected action given smaller issues' greater market volatility. The Dow Transports were also regularly mentioned. Although. unlike its more familiar counterpart. that average is not in new all-time high temtory. it has been outperforming the Industrials all year. having risen 43.5 from its January bottom as contrasted with only a 23.9 advance for the DnA. 1991 action for the DJTA. morecver. is taking on more and more of the characteristics of the right shoulder of a head-and-shoulders base a formation which goes back to the initial decline from the IOdicator's 1989 high. f such an mterpretation is correct, the upside implications are Impressive indeed. With aU the poSitive action on the part of a wide variety of market averages, it is. we suppose. churlish to note that the S & P 5()() (along with the S & P Industrials) failed to attain new peaks on Wednesday. remaining. at 392.80. about one percent under its August peak of 396.64. Following thIs lengthy discourse on the action of various, assorted market averages, it is well to renund ourselves that most investors at least (in what we cannot help referring to as the good old days. we could have said all investors). do not buy averages but indiVidual stocks. There is no substitute, in our view, for the exhaustive analysis of individual technical patterns as a means of amving at a market opinion. Unfortunately, at the moment, analysis of individual patterns leaves one considerably less euphoric regarding the market, than does inspection of general indicators. –.- The -Dow;,we remind curselves;-founditself-at-a-new-alltime-high-ast -Wedcesday,Inspection-of-the-new-high-list-for that- day. interestmgly enough. reveals only three DnA issues. Goodyear. International Paper. and McDonalds as reaching new indiVidual 52-week peaks. Seven more stocks are reasonably close. This. however. means that no fewer than two thirds of individual Dow stocks were. on the day that the average scored new peaks. significantly below their highs for the past year. Furthermore, we noted above that the Dow is at an all-tune high. When one compares current levels against the all-time peaks of individual stocks. the diversity is striking. as noted in the table below. stock ALLIED-SIGNAL INC ALUMINUM CO OF AMER AMERICAN EXPRESS AMERICAN TEL &TEL BETHLEHEM STEEL CORP BOEING CO CATERPILLAR TRACTOR CHEVRON CORP COCA COLA CO DISNEY WALT PROD DU PONT DE NEMOURS EASTMAN KODAK CO EXXON CORP Oct 16, 1991 High Date High 40.500 MAR 1987 49.250 63.875 OCT 1989 79.625 21.500 MAR 1987 40.625 39.125 DEC 1989 47.000 15.750 JAN 1984 29.500 50.000 JUL 1990 61.875 46.125 SEP 1987 74.750 76.625 AUG 1990 81.625 62.875 SEP 1991 66.500 117.500 JUL 1990 136.500 46.000 AUG 1991 50.000 45.625 OCT 1987 70.667 60.500 APR 1991 61.375 X Diff -17.77 -19.78 -47.08 -16.76 -46.61 -19.19 -38.29 -6.13 -5.45 -13.92 -8.00 -35,44 -1.43 Stock Oct 16 1 1991 High Date High GOODYEAR TIRE & RUBBER 44.750 AUG 1987 76.500 IBM 101.625 AUG 1987 175.875 INTERNATIONAL PAPER 75 .625 OCT 1991 76.000 MCDONALDS CORP 36.125 JUL 1990 38.500 MERCK &CO INC 130.750 SEP 1991 133.250 MINNESOTA MINING MFG 92.375 JUN 1991 97.500 MORGAN JP CO 64.750 OCT 1991 65.500 PHILIP MORRIS COS 73.500 AUG 1991 74.625 PROCTER &GAMBLE 82.875 JUL 1990 91.250 SEARS ROEBUCK CO 39.125 AUG 1987 59.500 TEXACO INC 65.375 APR 1991 70.000 UNION CARBIDE CORP 20.500 FEB 1989 33.250 UNITED TECHNOLOGIES 43.000 JUL 1990 62.500 X Diff -41.50 -42.22 -0.49 -6.17 -1.88 -5.26 -1.15 -1 .51 -9.18 -34.24 -6.61 -38.35 -31.20 Only two issues in the Dow. the table reveals. actually reached their all-time peaks in October of 1991. Only ten of the stocks reached all-time highs in 1991 at all Another seven scored their record peaks in July of 1990. back prior to the downswing which followed the gulf war Seven issues are still below their pre-1987-crash highs. What is more. only thirteen of the Dow stocks. at today's levels fiiid themselves within 10 of their record peaks. – Another ten are down from 10 to 40 percent and seven issues are 40 or more below all time highs. It is this sort of thing, we suspect. that causes the wide diversity in individual patterns. We have passed, It seems to us, the stage of the bull market where a rising tide lifts all boats. Action will. we think become increasingly selective. ANTiiONY W TABELL DELAAELD.HARVEY.TABELL Dow Jones Industrials (1130 AM) 3067.53 Standard & Poors 5()() (11 30 AM) 392.56 Cumulative Index (Oct 17, 1991) 6461.47 No statement or expression of oplmon or any other matter herein contained IS, or IS to be deemed to be, directly or Indirectly, an offer or the sollcltatlon 01 an offer \0 buy or sell any security referred to or mentioned The matter IS presented merely for the convemence of the subscnber While we believe Ihe sources of our Information to be reliable, we In no way represenl or guaranlee the accuracythareof nor 01 the statements made herem Anv action 10 be taken by the subscriber should be based on hiS own InvestlgaliOn and Information Delafield, Harvey, Tabell Inc , as a corporation and Its officers or employees, may now have, or may later lake, positions or trades In respect 10 any seCUrities mentioned In thiS or any future Issue, and such pOSition may be dMerent from any views now or hereafter expressed m 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 olher Issue Further Information on any secunty mentioned herem IS avadable on request

TABELL'S MARKET LETTER – 5 VAUGHN DRIVE, CN 5209, PRINCETON, NEW JERSEY 08543-5209 MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS. INC \609) 987-2300 October 25, 1991 If one is to believe tbe recent market stories in the financial press, it could be concluded tbat Small is Beautiful bas become 'thestock milrket's new-slogan- The-renaissance of the smallostock—particularly theover-the-counter small stock–is, by now, awi!ely accepted fact. There is some justification for this. The most recent spate of stories bas noted the fact that the OTC Industnals and Composite bave, along witb tbe Dow, been posting newall-time highs, this while tbe S & P 500, presumably representative of larger companies, has continued to languish below its peak close of 396.64 on August 28th. Ukewlse it cannot be denied tbat, since the pre-gulf-war lows of a year ago, the OTC indices have outperformed their large-cap counterparts. The NASDAQ Composite and Industrial mdicators have moved ahead 64.4 and 76.4 respectively since that bottom of just over a year ago while their S & P counterparts could do no better than similar 33 advances. We need, however, to recall a basic fact-the fact that smaller stocks inherently display more stock-market volatility than do larger ones, that tbey regularly move ahead more in a bull market and conversely decline more sbarply in bull markets. If we are to accept market action since last October as being part of a conventional bear market, then the better performance of the OTC indicators is a perfectly normal phenomenon. There will, we should remind ourselves, eventually ensue a cycle-length market decline, and, when this occurs, we should expect small stocks to decline more than their senior brethren. Only after this has occurred will we have tangible evidence of better small-stock performance. The best to gauge the relative action of small versus large stocks is to compute a ratio, in the chart below, which has appeared before in this space, the ratio of the S & P 500 to the Value Line Composite. (Using either of the NASDAQ averages would have produced essentially the same recent picture.) The action of the two averages themselves is shown by tbe thick and thin lines at the bottom of the page, while the upper line plots the ratio. RATIO (VALUE LINE I SIP SOD) S&f' 500 VAI,.UE LINE CCIfI'09ITE —–.-' The most important fact revealed by the chart is that the relative performance of small vs. large stocks is basically a long-term phenomenon. One did significantly better owning small stocks in the early 1960's and from the 1974 low through mid-1983. Since that time the sort of issues which dominate the 500 have been the place to be. Cycles do not, of course, go on forever, and it is possible that the tmy blip at the end of the chart may represent the start of the kind of reversal that took place in 1972-76. That reversal, it should be remembered, though, required almost four years to complete. Thus Ihe case for small stocks at tbe moment rests largely on their greater volatility and the assumption of an ongoing bull market. Investors willing to make that assumption and to accept the risks involved may well be justified in opting for owning smaller issues. Whether supra-cycle outperformance has begun, though, is a point which still remams moot. ANIHONYW. TABELL Dow-Jones Industrials (1200 noon) 3019.45 DELAFIELD. HARVEY, TABELL Standard & Poors 500 (12.00) noon) 385.45 Cumulallve Index (October 24) 6410.47 No ste.lement Or expression of opinion or any other matter herein contained IS, or IS to be deemed 10 be, directly or indirectly, an offer or the sollcllatlOn of an offer to buy or sell any secUrity referred to or rnen\loned The matter IS presented merely for the convenience of the subSCriber While we believe the sources 01 our InformallOn 10 be reliable, we In no way represent or guarantee the accuracy thereof nor of the statements made herein Any action to be taken by the subSCriber should be based on hiS own InvestlgallOn and Informallon Delafield, Harvey, Tabellinc , as a corporation and lis oHlcers or employees, may now have, or may later take, positions or trades In respect to any secunbes menllOned In thiS or any future Issue, and such poSition may be different from any views now or hereafter expressed rn thiS or any other rssue Delafield, Harvey, Tabellinc , which IS registered With the SEC as an Investment adVisor, may give adVIce to Its rnvestment adVISOry and other customers Independently of any statements made In thiS or In any other ISsue Further Information on any security mentioned herein IS available on request

… -.. TABELLS MARKET LETTER 5 VAUGHN DRIVE, CN 5209, PRINCETON, NEW JERSEY 08543-5209 MEMBER NATIONAL ASSOCtATION OF SECURtTtES DEALERS, tNC (609) 987-2300 November I, 1991 Round numbers (such as 3000 on the Dow) seem to fascinate stock-market watchers. Such interesting numbers can also exist in -other-markets, however. -For example,-.91-dayTreasury-1lills-sold-atuctiontbjs week to-Yleld 4.99 .TIus constituted the -first tlme since 1977, some fourteen years ago, that T-Bills had traded under the 5 yield level. This was not without its effect on the stock market. The Dow rose sharply on the first three days of the week, although it stopped just short of posting a new closing high, above its October 18th level of3077,15, Most averages of OTC stocks did, in fact, reach new peaks, although positing the eXistence of a correlation between the over-the-counter and treasury-bill markets is an endeavor that stretches credulity. There can be little doubt, though, that we have, at the moment, an interest-rate-driven market ThIs fact, of course, makes for some interesting paradoxes. After interest rates, the two most popular tOpICS of stock market discussion these days are the two R's. recession and recovery. When Alan Greenspan expressed. mild dissatisfaction this week over the pace of the recovery, this was taken to imply continued Fed accommodation in the money markets, whIch,according to the current conventional wisdom, would, perforce, continue to fuel ever-rising stock prices. According to this theory. the best thing that could happen to the stock market would be a full-blown depression The Fed could then comfortably bring bill rates down to around 1, and presumably the Dow would be at 10,000. This reductio ad absurdem is simply meant to suggest the fact that, at some pomt, the health of the economy—and consequent corporate earning power—needs to be taken mto account in evaluatmg the prospects for equity prices. The justification for higher, or at least firm, stock pnces rests, it seems to us, on the not illogical proposition that (1) the recesslOn IS over, (2) there Will therefore ensue the sort of earnings recovery which has characterized just about all recession bottoms since World War II, and (3) tbat recovery will be sufficient to justify not only current pnces but somewhat higher ones, a Jushfication which seems necessary given the currently full pnce for equities There has been some suggestion, especially from those who lean toward the Democratic side of the political fence (and who seem to be salivating at the prospect), that the first of these conditions may not be being met. If this is indeed true–that the recession is not over—the electoral prospects for a George Bush opponent certamly improve, but the prospects for the stock market do not. Given the assumption of a recovery now under way, we are, for now, relatively unconcerned about the probability of its assuming some kmd of unusual shape. It bas been our experience that at most recession bottoms the fear IS expressed that the subsequent uptrend-may be-unlike-all-other-uptrends-in-thelong history of-business cycles. Thisfear-generally le.ds-to-predictlon of exottc phenomena such as a double dip. Proponents of such theories generally do not cite historical examples undoubtedly because such examples are scarce to non-existent. If recovery is indeed upon us, we see no reason that it Will not assume a conventional shape and produce the sort of rise in reported profits that occurred, for example, in 1981-1982. It is, however, probably uncertainty about earnings prospects that has produced what, we have repeatedly suggested in this space, is a somewhat unusual technical shape. Between its January low and April, the DnA rallied some 21 , to a high of 3004.46. Three subsequent rallies have taken pJace–to 3035 in June, 3027 in August, and 3077 two weeks ago, These were all preceded by mild corrections, ranging in length from two to four weeks and in no case exceeding 5 We have now gone well over 200 trading days witbout a 5 correction, Uninterrupted advances of this length are rare. There have Date June 1949-June 1950 Change 41 3 No. of Days 282 indeed been only nine such advances since 1946, and they are hsted in the table at nght. As can be seen a great many have been the start of maior bull markets including those of 1949, Sept 1953-Jan 1955 Dec 1957-Aug 1959 600 593 326 410 1953, 1957, and 1970. Only one, that of 1961, has been the terminal rally of a larger bull market. The others have occurred somewhere in the middle of their parent upswings. Oct 1960-Dec 1961 Nov 1963-May 1965 298 32.0 284 370 The interesting fact about the current advance is that it is by far the shortest of any in the list. This, of course, could simply mean that it still has more time to run. However, it is July 1970-Apnl 1971 Dec 1984-Apr 1986 420 595 205 343 also suggestive of the rather flat slope of the uptrend as it has evolved so far. -, -' We suggested m tins space a month ago that this shape Nov 1988-0ct 1989 Jan 1991-0ct 1991 369 24.6 225 197 was somewhat unusual, using another set of figures to make the point Updating those figures now shows that we have remained for 38 weeks, since mid-February, withm a low for the S & p 500 (in May) of 368.57 and an August hIgh of 396.64, a range of just 7.62 . This is a record for a 38-week period, eclipsing the 7.66 range whIch prevailed between February and October 1972. Further records may be set if the S & P continues to hold WIthin these bounds. The 42-week record is 8.49 and the 44-week record 9.33 . Current symptoms are, we think in summary, those of an uncertain market, and a clearer mdication of 1992 earnings prospects will be necessary before a defInlte trend can estabhsh ltself. Dow Jones Industnals (12 noon) 3055.46 S & P 500 (12 noon) 391.06 ANTIIONY W TABELL DELAflELD,HARVEY,TABELL Cumulative Index (Oct 31, 1991) 6489.59 ' 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 or the soliCitation of an oHer to buy or sell any secuflty referred 10 Of menltoned The matter IS presented merely for the convenience of the subscnber While we believe Ihe sources of our information to be reliable, we In no way represent or guarantee the accuracy thereof nor of the statements made herein Any action to be laken by the subSCriber should be based on hiS own Invesllgatron and mformatlon Delaheld, HaNey, Tabell Inc , as a corporation and Its officers or employees, may now have, or may later take, POSitIOns or trades In respect 10 any secuflltes mentioned In thiS or any future Issue, and such POSition may be dlHerenl from any views now or hereafter expressed In Ihls or any other Issue Delafield, Harvey, Tabellinc . which IS registered WIth the SEC as an Investmenl adVIsor, may gIVe adVICe to ItS Investment adVISOry and other cuS10mers Independently of any statements made In thiS or In any other Issue Further mformatlon on any security mentioned herein IS avaIlable on request ,

TABELL'S MARKET LETTER 5 VAUGHN DRIVE, eN 5209, PRINCETON, NEW JERSEY 08543-5209 MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS. INC (609) 987-2300 November 8, 1991 We noted last httle-tbruiapparelrt'When', on week that, there can be Wed;e;daY7the market lIttle doubt.. responded to- thtehfaitftwh-e ;h;a-vne-. ;.-a;nutmUt ei-rtebset -rr a-teed-donuvnetnramtaer'kWeltt.h ThIS may have seemed less mOTe than-a-yawn — -We thmk, however, that It can be taken as gIven that conventional wIsdom has, for qUite some tnne now, tended to regard the dIrectIons of the stock and bond markets as bemg positIvely correlated. We remam skepttcal regardmg thIS supposed correlatton. and we mtend. therefore. to spend a few of these letters exammmg It In such exammations, It IS well to begm by takmg a long-tenn VIew, and the chart below does that, traclDg the monthly history of the DJIA and the yield for Moody's AAA Industnal Bonds smce January, 1919. The Yield, as inspection Will reveal, IS plotted on an mverted, loganthmic scale so that tbe senes shown effectively traces the hIstOry of long-term bond pnces. DOW JONES INDUSTRIAL AVERAGE . eONO MARKET BOiTOMS Ii VIELD – MooDVS AAA IHOUSTRl BONOS The fust and most ObVIOUS charactenstlc of mterest rates IS, as SIdney Homer noted long ago, the eXIStence of extremely long and persistent cycles Thus the entrre penod from 1920. when bonds returned 6.47, to 1940 (2.28), can be vIewed as a long buU market, and the 41 years to 1981. when the YIeld reached Just under 15, as an ongomg bear market. For the record, we belIeve that decade-01d low to have been the start of a long-term upward cycle m bond pnces whIch has, obvIOusly, a number of years yet to run These long cycles seem to have lIttle correlatton WIth the stock market. The 1920-1940buU market mcluded the upswmg of the 1920'5 but also the bear market of the 1930'5. At Its end stock pnces were Just about where they had been twenty years before. And the 41-year bond bear market saw some of the best stock markets m recorded htstory. What about the correlattonof the shorter cycles shown on the chart by solid verttcallmes at bond-market bottoms and dotted lines at tops Here the recent record IS good. Smce 1981, bond-market turns have accurately mlITored stock-market ones ThIS may en account for the current fascmatton WIth mterest rates as an explanatIon for stock-market behaVIOr. However. as a glance at the chart Will show, the record over tIme has been less ImpreSSive. Throughout the 1940's. 1950'5 and 1960'5, the bond market regularly turned down so long before the eqUity market that It was effectively useless as an mdlcator. If we regard major turns m the bond market (we use a 10 fIlter to defme major turns) as stock-market sIgnals, there have been 24 such Signals 111 the penod shown. FIfteen were correct, but the strategy of buymg and se1l1l1g stocks at bond-market turns would not have bettered the return from Simply buymg and holding eqUItIes. Looked at another way. If one uses hmdslght to defme bull and bear movements 10 the bond and stock markets, It turns out that, of 850 market months smce 1920, the stock and bond markets were movmg 10 tbe same dIreCtion m 430 months and in OppOSIte directIons m 420 months. Obviously, the supposed correlatIon between tbe stock market and mterest rates deserves further eXam1Oatlon. ANTHONY W TABELL Dow Jones Industnals (12 noon) 3062 16 DELAFffiLD,HARVEY,TABELL S & P 500 (12 noon) 39484 Cumulative Index (Nov 7, 1991) 6525.24 No statement or expressIon 01 oplnlOf\ m any ether matter heleln Conta.lned IS, QI IS to be deemed to be, dlrectl,/ or lrnilrectl'j, an offer or the so\\CltatVln 0\ an offef 10 bu,/ or sell an secunl relerred to or menllOned The matter IS presented merely fOf the convemence 01 the subSCriber While we beheve Ihe sources of our IIlfOrmatlon to be reliable. we m nO way represent or guarantee Ihe accuracy thereof nor of the statements made hereIn Any acllon to be taken by the subscrIber should be based on hIS own InvestigatIon and Informal!on Delalleld, Harvey. TabeU Inc. as a corporallon and lIS 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 different from any views now or hereafter expressed In thIS or any other Issue Delafteld. Harvey. Tabelilnc whIch tS regIstered wrth the SEC as an mvestment advIsor. may gIve adVIce to Its IIlvestment advISOry and other customers Independently of any statements made m thiS or In any other Issue Further lnformallon on any security mentioned herem IS avaIlable on request

TABELL'S MARKET LETTER 5 VAUGHN DRIVE, CN 5209, PRINCETON, NEW JERSEY 08543-5209 . ,-'- MEMBEA NATIONAL ASSOCIATION OF SECURITIES DEALE AS, INC (609) 987-2300 – -r– November 15, 1991 As the market continues in the relatively flat trading range which has characterized most of 1991, It IS worth recalhng that next …. year. such 1992,-is a years back presidential elec-lion year.–OurIong-tenn readersare.awa!.tha.kwehavetracked the behavior of thestock to the beginmng of the century, and the results are shown below The table shows each election year since market in 1900. the president elected in that year and his party, followed by the average pnce of the S & P 500 for each month dunng the year expressed as a percentage of the prevIous December's close (i.e. llO means the market was up 10, 90 means it was down 10). Year President Jan Feb Mar Apr Mav Jun Jul AUQ Sep Oct Nov Dec 1900 McKinley R 101 103 104 105 100 98 98 99 97 100 108 114 1904 Roosevelt R 102 99 99 101 99 99 103 107 112 118 125 126 1908 Taft A 105 100 105 111 117 117 123 126 125 126 134 138 1912 Wilson D 100 99 102 106 105 105 106 109 109 109 108 103 1916 Wilson D 99 98 97 96 98 99 98 99 102 105 107 103 1920 Harding A 99 91 97 96 91 89 89 86 89 89 85 77 1924 Coolidge A 103 104 102 100 99 101 101 113 112 110 115 119 1928 Hoover R 99 98 103 109 113 107 108 111 119 122 130 130 1932 Roosevelt D 102 101 102 77 68 59 62 93 102 88 87 84 1936 Roosevelt D 102 108 111 111 105 109 116 118 120 126 129 127 1940 Roosevelt D 98 98 97 98 85 77 80 82 85 86 88 84 1944 Roosevelt D 102 101 104 102 104 109 111 110 108 111 110 112 1948 Truman D 97 92 93 101 106 110 107 104 103 106 100 99 1952 Eisenhower R 102 100 100 100 100 103 106 106 104 102 105 110 1956 Eisenhower R 97 98 104 106 102 102 107 107 103 102 101 102 – 1960 Kennedy 1964 Johnson D 97 93 92 93 92 96 93 94 92 90 93 95 D 102 103 105 107 108 107 111- -r09 111 113 114 –,-,-z 1968 Nixon R 99 94 92 99 101 104 104 102 105 108 109 110 1972 Nixon R 101 103 105 107 105 106 105 109 107 107 113 115 1976 Carter D 107 112 112 113 112 113 116 115 117 113 112 116 1980 Reagan R 103 107 97 95 100 106 111 114 11 7 121 126 124 1984 Reagan A 101 95 95 96 95 93 92 100 101 100 101 100 1988 Bush A 101 105 108 106 104 110 109 107 109 112 110 112 Incumbent party did not control Congre!l. Incumbent party not reelected The first POlDt of interest is that presidential election years tend to demonstrate a mildly bullish bias. Only three of them (1920. 1932, and 1940) are distmct bear markets Fourteen of the 23 years are bull markets, 1988 being a typical example, and six showed a relattvely flat trend. Despite the upward bias shown for full years, there appears to be some tendency In the direction of a flat or moderately weak market through in the year's first half Eleven of the 23 markets showed little change—Slx percent or less either way–through June. It IS worthy of note that a downward bIas tends to occur on two sorts of occasions. The first is when the incumbent party does not control Congress. which. of course, we know currently to be the case. The second is when the party of the incumbent president loses the election. Only an 1976. when that occurred, was the market up more than six percent in the first half. Thus the direction of the market in early 1992 may be a good indicator of (presumably) President Bush's chances In November. In thiS area. as In a number of others. the market tends to anticipate, and we would not want to argue With the thesis that the market IS a reasonably good indicator of election results, rather than the other way around. For predictIve purposes, an tnteresting figure to watch will be the average pnce for April. There have been nine election years In the century where that price was lower or the same as at the previous year end In six of those nme years, the incumbent preSident's party was replaced ID the WhIte House Also interesting -is the dIstinct tendency toward a strong second half In nineteen of the 23 years the average pncc for December was higher than the average price for June This appears to be the case regardless of the election results. and even ID bear-market years, where. in the past. the market has rallied In the second half from June lows In only two of the 23 years, 1920 and 1948. were there significant declines bet\1leen June and December. Thus, although we have become accustomed to, even bored With. a flat-to finn market in 1991 so far. the electIOn-year pattern would seem to call for Just that sort of market In the first half of 1992. (A sharp nse in November-December. of course. remains a POSSibility. and thiS would not be inconsistent WIth yet another seasonal pattern-the year-end rally) The market's pattern m early 1992 may. as noted, be a reasonably good IDdIcator of Republican chances next fall. The second half of 1992. hIstory strongly suggests. should see a rising market Guessmg the level from which that nse might take place, however. Will reqUlre a study of matters more timely than the November-1992 election ANTIIONY W TABELL DELARELD,HARVEY.TABELL Dow Jones Industrials (12 00) 3042.93 Siandard & Poors 500 (1200) 39422 CumulatIve Index (11114/91) 656773 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 se!! any security referred to or mentioned The matter IS presented merely for the convenience of the subscnber While we beheve the sources of our Informallon to be rehable, we In no way represent or guarantee the accuracy thereof nor 01 the statements made herein Any acllon to be taken by the subSCriber should be based on hIS own Investigation and Information Oelafleld, Harvey, Tabe!! Inc, as a corporation and Its officers or employees, may now have, or may later take, pOSitions or trades In resped 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, Tabelllnc, 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 information on any security mentIOned herein IS available on request

TABELL'S MARKET LETTER —————– 5 VAUGHN DRIVE, CN 5209, PRINCETON, NEW JERSEY 08543-5209 MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS. INC (609) 987-2300 November 22, 1991 7 We.were, onre lJglJi1J, tfflLctp.fl lt wepkwlthour fanuhl,r–onoon-fnd;a).cIdlinesyndrome,when the market-dropped some 80 r points between the letter's delivery to the printer and the close. Even with the Dow sinking somewhat lower on Wednesday. the entire declIne was under 5, the filter we generally employ to identify minor market moves. However. the episode brought forth the usual Chicken Littles, who duly noted that we had been present at only the seventh lOO-point decline in all recorded history. With the Dow above 3000, of course, 1oo-pomt daily swmgs are likely to become more and more common. Measured properly, what did take place last Fnday was a downswing of 3.93, and It IS agamst like percentage declines that Fnday's market should be measured. For tbe record, the 19001909 Number of 3-or-Greater. 1-day DecUnee 24 19501959 3 total number of 3 -or-greater drops 10 thIS century IS 278 — an average of no fewer than three such occurrences per year. We have broken 1910-1919 19201929 30 19601969 30 19701979 1 5 out tbe appearances of such declines by decade in 19301939 152 19801989 15 the table at right, and a quick glance will show that they are by no means evenly distributed over 19401949 15 TOTAL 278 time The severity of the long bear market of the 1930's is underscored by the fact that more the half the declines of 3 or greater occurred during that decade. For the first thirty years of the century the frequency of such declines was about in line with the average, n.but, subsequent to World War in that great secular buH market, there took place only a few such declines. There was indeed only one (1962) in the IS-year period 1955-1970. Simply countmg 3 drops, however, IS not partIcularly useful. As we all know, such drops are cbaractenshc of selling clImaxes and, unsurprisingly therefore, more than half have occurred in the advanced stages of bear markets—when the Dow was in the lowest quartile of 1East 2-day rang,—-On Fnday. howevet V!C were in the l!P'p'er guartile of that rangThere ecionly- 14 li!'c.h cases smce the early thuties and they are shown in tlie table below – – – – – – — – THREE PERCENT DECLINES WITHIN ONGOING BULL MARKETS – 1938-1991 Date Dechne Aftermath August 29, 1938 344 Market topped In November 1938. A number of facets of the fourteen declines are interesting A large number of them seem to be event driven–comcIdmg with such September 13, 1938 428 FollOWing that top, DJIA dropped 42 to April 1940 happenings as the Korean war outbreak Those that are not January 23, 1939 371 Dow stili close to November peak prior to 1938-40 drop. obviously so driven display a April 9, 1943 February 25, 1946 -3.17 -4.29 Correct!on over !n a few days followed by new highs. Dow at 212 In May, 1946. Did not exceed that for 4 years varied record. Some—Apnl 1943 and October 1982 for example–tumed out to have November 3, 1948 June 26, 1950 385 465 Truman election Continued fall until June, 1949 bottom. Korean war One month decline, then recovery to new high no lasting significance, and the Dow soon went sailing merrily along to new highs. There September 26, 1955 6.54 Eisenhower heart attack. Market recovered by November does. however appear to be October 25, 1982 3.52 Followed huge Aug.-Oct. upswing New highs a week later some tendency for sharp oneday declines after a long bull July 7,1986 3.25 Market turned Irregular through end of year market to be associated with September 11, 1986 October 6, 1987 461 347 See above. aOO-polnt flse followed to August, 1987 October 19,1987 e!ght trading days later. tops ThIs was the case back in 1938, for example when three sharp drops took place October 13, 1989 November 15, 1991 -691 -3.93 UAL takeover collapsed. New highs m Jan. 1990 Top m Aug. , around the high of the baby bull market of that year. Such a drop proVided a fauly good. signal of the !ugh In 1946, and, of course, hindSight makes us painfully aware that it would have been wise to pay attention to the sharp drop of October 6, 1987. Overall, the record is certainly not conclUSive Bear markets during the 1950's, 1960's and 1970's conspicuously failed to produce any sharp one-day falls lD the VIClDlty of their hIghs as witnessed by the almost total absence of any such declines dunng those years The fact that the number of such events seems to be increasing is interestmg, though. and suggests that we nught, as further technical evidence contmues to unfold, take last Friday's action as constituting a kind of yellow cautton signal. ANlHONY W TABELL Dow Jones Industrials (1200) 6401.80 Standard & Poors 500 (12.00) 377.53 Cumulative Index (11/21191) 2913.69 DELAFIELD. HARVEY, TABELL Nostatemenl or expressIon of opInion or any other matter here!n contaIned !s. or IS to be deemed to be. directly or indirectly. an offeror the sollcltalton of an offer to buy or sell any secunly referred to or mentIoned The matter IS presented merely for the convenience of the subscnber Wh!le we beheve the sources of our Informatton to be rehable. we In no way represent or guarantee the accuracy thereof nor of the statements made herein Any actIon to be taken by the subscnber should be based on hIS own !nvestlgatlon and !nformatlon DelafIeld. Harvey. Tabell Inc , as a corporatIon and !Is officers or employees, may now have. or may later take. posll!Ons Of trades In respect to any secuntles mentioned In th!s or any future Issue, and such position may be d!fferent from anyv!ews now or hereafter expressed In this or any other Issue Oelalleld, Harvey. Tabellinc. whIch IS reg!stered With the SEC as an Investment adVisor. may give adv!ce to Its Investment adVISOry and other customers !ndependently of any statements made In thiS or !n any other Issue Further information on any security mentioned herein IS available on request

TABELL'S MARKET LETTER 5 VAUGHN DRIVE, CN 5209, PRINCETON, NEW JERSEY 08543-5209 MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC (609) 987-2300 November 29, 1991 We remarked in this space a couple of weeks ago on the recent fashion of explaining each and every gyration of the stock ln8Jket in tenus of interest-raLes. – CUrrellt conventional-wisdom seems io-be assliming ihil\herc exjls a positive correldtion betweeli – interest rates and the stock market. We began. therefore, an examination of that hypothesis, and we continue it herewith. The first thing we noted was the obvious, but often ignored, fact of evident very-long-tenn interest-rate cycles, the most recent examples having been a bond bear market from the 1940's to 1981 and a major bull market since. We also made an atlempt to identify bull and bear bond-market swings within that conlext by applying a 10 filler 10 bond-yield dala. The figures in this letler apply the same filter to bond yields from 1950 to date using daily prices. We have been able in this fashion to identi fy eleven BOND AND STOCK MARKET BOTTOMS – 19631990 bond market botloms since 1953 along with ten tops. (lbe present Bond Bottoms Stock Bottoms Days Lead Bond Bottoms Stock Bottoms Days lead Irend, obviously, is up.) The lable at right gives the dates of those eleven bottoms. The Jun 16 1953 Aug 15 1957 Sept 141953 Oct 22 1957 63 Oct 1 1981 47 Feb 91982 Aug 12 1982 128 present fascination of equity analysts wilh bond prices may stem from the fact that it is possible to identify no fewer than ten of those bottoms with major Jan 28 1960 Ju1v 2 1970 Sept 201974 Oct251960 Mev 261970 Dec 6 1974 188 JulV 2 1984 Ju1v 24 1984 27 Oct 20 1987 Oct 19 1987 54 Mar 29 1989 Oct 11 1990 15 -, 390 bottoms in stocks. most difficult to tie (The one to a stock lo.bMar;7;;1;98;0'';'''Ap'ri;l 2;1;19;8;0;'''''3;0;';;;;;'d is, ironically, the bond market's major long term low in 1981 t when yields reached 15 .) The bond bottoms, furthermore, appear in most cases to lead the stock market! Taking the opposite point of view, seven of the nine equity-market bottoms which we identify in the period under study have becn associated, usually with a lead, with lows in bond prices. Only the collapses of 1962 and 1966 appear to have no bond-market -pnrp!rL In addition, boncd..b.ottoms w.erellSsiatedwjth important intermediatecterm.drops.in 196.L19.8S1., and-'8. . – When we try to make practical use of this information, however. we encounter a number of difficulties. 1)1e first is that the lead times tend to be short, thus making it necessary for the stock-market analyst to identify bond- market lows with precision. This is not all that easy to do. In all but two of the cases (1980 and 1982) the bond market bad mllied less than 50 basis points off its low by the time of the stock-market bottom. BOND AND STOCK MARKET TOPS – 1964 – 1990 Bond Top Oct 27 1954 DJIA 355.73 Daye Lead 681 Stock Top Jan 12 1957 DJIA 520.77 June 17 1958 47897 879 Dec 13 1961 734.91 March 27 1963 68473 724 Fob 9 1966 995.15 Feb 161971 890.06 685 Nov 1 1973 948.53 Jan 5 1977 97806 424 Sap 11 1978 907.54 46 53 45 7 -7 Even if it is conceded that bond-market action may have some value for forecasting purposes at bottoms, its usefulness at equity market tops appears to be close to nonexistent. The lable at left lists the ten bond peaks that a 10 filler identifies along with the subsequent highs in the equity marts. Here precisely the opposite problem from the one encountered with bottoms occurs. In the case of tops the lead time is unconscionably longl Up until 1980 at least, lhe bond market topped out well in excess of a year before the stock market, June 17 1980 879.27 216 April271981 1024.05 16 and in one case (1958-1961) the lead was over three years. Needless to say, in these cases Nov 301981 equities still had the bulk of their bull-market Mav 11 1983 121972 advances ahead of them at the time of the interest- 55 Nov 29 1983 1287 20 5 rate peaks. To iIIustmte this we have also shown Jan 22 1987 2145.67 149 Aug 251987 2722.42 27 in the lable the comparative levels of the Dow Jones Industrials at the bond and stock peaks and Fob 3 1988 192457 799 Julv 17 1990 2909.75 55 have listed the percentage advances in the right- hand column. – A couple of the more recent signals may be said to have had some value. Bonds turned downward on May II, 1983, six months before stocks did so and without too much ofa 'missed' advRDce in the DJIA. The January 1987 bond market top also can be credited with presaging the October 1987 collapse, although at the time of the bond market high stocks were 600 points below their ultimate August peaks. Since investor memories often tend to be short, these two recent SUCcesses may have contributed to some degree to the reputation of bond prices as a forecasting tool. In summary then the trend of the bond market may be 8 margina1Jy useful harbinger of stock market boltom.., but it is of little use at tops. This comment is presently relevant since. with the Dow standing, as of a month ago, some 30 above its year-ago levels, it is, at the moment, a top we are trying to identify, not a bottom. There are many indicators we expect to be using to look for an upcoming peak, but a correction of the bond advance will not be one of them, despite the furor it will undoubledly elicit. Dow Jones Industrials (12'00) 2893.34 Standard & Poors 500 (1200) 375.14 Cumulative Index (11127/91) 6418.11 ANTIlONY W. TABELL DELAFIELD, HARVEY, TABELL No statement or expression of opinton or any other matter herem contained IS, or IS to be deemed to be, dlreClly or Indirectly, an otler or the soliCitation of an offer to buy or sell any secUrtty referred to or mentioned The matler IS presented merely lor the convenience of the subscnber While we believe the sources of our Information to be reliable, we m no way represent or guarantee the accuracy thereof nor of the statements made herem Any aclton to be taken by the subscnber should be based on hiS own investigation and Information Delafteld, Harvey, Tabelllnc, as a corporation and Its officers or employees, may now have, or may later take, positIons Of trades In respect to any secuntles 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 Inc , whIch IS registered wrth the SEC as an Investment advisor, may give adVice to tts Investment adVISOry and other customers Independently of any statements made In thiS or In any other Issue Further InformatIon on any secunty mentioned herem IS available on request

TABELL-S MARKET LETTER 5 VAUGHN DRIVE, CN 5209, PRINCETON, NEW JERSEY 08543-5209 MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC 16091987-2300 December 6, 1991 – —— A-cn.u.aai question regarding the'prospeet for'ilitiesanlie moment seem-s-U,–us tobe7Mis'-ilie SfOckmaiket aheado'r behind. We are prompted to this query by our reading of the daIly press–the entire press, it must be noted, not simply the fmancial page The most widely-used word therem is, it would seem, recession. which phenomenon tends to be cited lD the media as the cause of most of the world's major ills, some of these ills having only a tenuous connection with the economy. Our own reading of the Sunday newspapers last week left us hardly surprised by Monday morning's 30-point fall in the Dow and, indeed, gratified by the subsequent recovery. Like most stock market moves of late, though, tbat one failed to follow through, the averages by and large ending the week a bit lower than where they had started. The press's function, of course, IS to report current events The continued reference to the recession IS, therefore, CUriOllS, SLDce it seems to he the consensus among those who ought to know—professlonal economists–that the recession is over, has been over, as a matter of fact, for some six months. Economists, of course, seldom agree, but the current source of disagreement centers around the nature of the recovery presumably underway. A look at numbers, rather than words, also suggests that the recession has run its course. Real GNP (or GDP, Gross Domestic product, the successor the Department of Commerce is about to foist on us) bottomed In the second quarter. The Department's Index of Coincident Indicators, presumably the most efficient measure of the current state of the economy posted a low in March and remains well above that low despite a modest retreat from mid-summer levels. A casual newspaper reader, however, would have to conclude that the economic contraction is ongoing, Part of the confusion may in fact result from the timing of the reporting of peaks and troughs in the business cycle. We now know, of course, that the recession offiCially began in July, 1990. We were, however, not aware of that fact at the time. The official recogrntIon of the date came much later, in the Spnng of 1991. Likewise the end of the recession has not yet, m November 1991, been offiCIally announced, nor will it be for quite some time–until a recovery is long underway. Which returns us to the original question–Is the stock market ahead of or behind a busmess cycle turning point1 To those familiar with the historical record, there can be little doubt as to the stock market's normal behavior in this regard. It has almost invariably been nahead—tending, in other words, to lead turns in the business cycle. This mstorica1 tendency is so strong that the S & —p5)(thllS beeoofficiallycitedasone oLthe.elevenJeadingindicators.used to.fot !h.!'Sours-L!he-OJlomy.Desplte this ,anellon. ' the bulk of Wall Street verbiage generally winds up trying to forecast the stock market by reference to the economy, when all the data suggests it should be the other way around. There is little in the present picture to suggest that anything other than the normal sort of historical correlation between the busmess cycle in the market. The latter, as we all know, bottomed last October, with a secondary bottom, arguably the true n bottom In January of this year. If the normal sequence can be said to have been followed, it is perfectly logical to suspect that the recession ended 1D the early Spring of this year-March is as plausible as guess as any–and that expansion is now well under way Ag8.J.n, a simple-minded glance at the data confirms all tms. Construction activity, one of the weaker sectors of the economy, has been nsing. Factory orders showed a modest increase for October. Recently announced thud-quarter GDP was up. Unemployment, announced this morning, was flat. True, there are signs of weakness. Jobless claims, for example, continue to rise. Consumer sentiment has deteriorated. since last Spring (here the media's obsessive focus on the recession may be relevant), but remains well above the abysmal levels reached at the end of 1990 Many economic indicators are laggards and indeed the composite of such indicators is shll falling. This, however, is absolutely normal if we are now, in fact, 6-8 months into a recovery. Given all tms, one can examine current stock market valuation levels with a bit more equanimity. There is no need at this point to recite a litany of pIe-ratio and yield statistics. It is a SImple and, it seems to us. incontrovertible fact that the market is at the moment hIStorically high and is not too far away from belDg what can be called dangerously high. This, however, is not a great cause for concern if the market is right –if, m its sharp rise last Spring, it was exhibiting its normal tendency and forecasting a business cycle recovery . What, however, if the market is wrong. First of all, it must be noted that this does not happen very often. There have, however, been reVISions LD consensus estimates in the past, and there wIll be again. The end of the 1990-1991 recession, remember, has not yet been officially announced. Suppose that, just this once, the market is behind the public perception of economic reality as expressed in the news columns. That incorrectness, coupled with high valuation levels could produce–to say the Least—unpleasant consequences for stock prices We may be entering a period, therefore, when careful inspectIOn of economic statistics miy be useful-perhaps almost as useful as Wall Street tends to think it is. What will also be important though is the market's techmcal actton, for it is that action whIch will probably afford us the first clue as to whether the market is presently making one of its rare mistakes. ANTHONY W. TABELL, CMT DELAAELD,HARVEY.TABELL Dow Jones Industnals (1200) 2897.81 Standard & Poors 500 (12.00) 379.60 Cumulative Index (12/5191) 6400.03 In case readers are cunous regardmg the acronym follOWing the SIgnature me above. 11 lS noted thal u stands jar C1U1.rtued Market Techntczan We were lftstrument(ll m the devdopmem althu professfOna cemficanon program and are proud, havmg pasud the requtslU exanunanon, 37 years expenence nOlwuhsrandmg, to have, selves, qualified/or II HallUlg remained In our chosen professIOn for alJ those years, It goes wuhaul saymg that IW regard II as an honorable, scholarly, and dignified one, and we congratulate me Marlut TechmcUlIU AssocUltJon, winch admuusrers the CMT program,for lIS tjJortS mfosunng professIonal recogTUtionfor uchmcal marAzt analysIS No statement or expressIon of opinion or any other matter herem contained IS, or IS to be deemed to be. directly or mdlrectly, an oHer or the soliCitation of an offer to buy or seff any securrty referred to or men\loned The matter IS presented merely for the convenience of the subSCriber While we believe 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 to be taken by the subSCriber should be based on hiS own Investigation and Information Delafield, Harvey, Tabeff Inc, as a corporation and Its officers or employees, may now have, or may later take, pOSitions or trades In respect to any securities mentioned In thiS or any future Issue, and such pOSIlion may be different from any views now or hereafter expressed In thiS or any other Issue Delafield, Harvey. Tabeff Inc, which IS registered wllh the SEC as an Investment adVisor, may give adVice 10 Its Investment adVISOry and other cuS10mers Independently of any statements made In thiS or In any other Issue Further Inlormallon on any secunty mentioned herein IS available on request

TABELL'S MARKET LETTER 5 VAUGHN DRIVE, CN 5209, PRINCETON, NEW JERSEY 08543-5209 MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC (609) 987-2300 December 13, 1991 Yeru-ed forecast .time has rolled around once more, and readers will recall our custom of dividing our forecast into two parts— the first conslstmg of a review of the past year's market. Vacation plans require that this letter constitute the review portion. Our forecast-,vi!l2.ppear-on January-3rc!; — . – — !'– – – – – –,.-.— – – …. – 1991, as will become apparent, is not a terribly hard year to summarize. Such a summary properly begins on October 11, 1990, . OTC INDUSTRIAL J900 when the DnA reached a low at 2365.10, which turned out to be the end of what was, in every aspect except length (It was less than J800 3101) three months long.), a fairly typical cycle bear market. The conventional explanation for this decline. which took the average down some 3601) J500 21 . was Iraq's seizure of Kuwait. The subsequent recovery carried intI early January, when the announcement of U.S. military action Sal' 500 3400 3300 set off what might have been a plunge to new lows. However, the success of that action 3200 brought about a dramatic turnaround. By 311)0 March 6th, the Dow had reached 2973.77, up 25 from the October low and over 20 m 3000 just eight weeks from the January bottom. In away, the year can be summarized 2900 by noting that that ten-month-old figure is Just slightly higher than today's level. The bulk of 1991 action took place in the first two months, – –i'ollowedby-the year'B.liIl.Cfeaturetlie -t'en-'C-O–'-' –2100 month trading range with the largest short-term 2600 swing in those ten months, at least until the most recent drop, being under 6. DOW JONES INDUSTRIAL AVERAGE 2OO The range, it must be noted, had a slight upward bias. The March high was exceeded in April at 3004, in June at 3035, in ''4h—r–r-..,–,—r—,r–r–r-..,–,—r—,r–r-J- HOO August at 3055 and, finally, at what has been the bigh to date, at 3077 .15 on October 18th. The S & P 500 essentially mirrored this action, outperfonoing the Dow in the Spnng, lagging in the summer as it failed to reach a substantive new peak until well into August. The year's other salient feature, from a technical point of view, was the distinct unprovement, for the first time since 1983, in the relative strength exhibited by secondary stocks. Inspection of the action of the OTC Industnal Index on the chart above makes this point obvious. WIule the Dow was advancing 21 between January and April—and the S & P, 25–this NASDAQ index was moving ahead an astonishing 49. The index rested over the summer– a new bigh was not made until August—but action has picked up somewhat since. A 9 rise has been scored between the April and October highs while the senior averages tacked on only a couple of percentage pomts. This better relative strength has continued in recent weeks, the OTC average having held above its late November highs while the Dow moved to a new post- April closing Iowan Tuesday. – . . All this is -of moderate 'interest, but the important feature of 1991 is the long, flat pattern displayed by the maior averages. We Illustrate that pattern, using the Dow, in a different format— the 20-pomt-unit, pomt-and-figure chart displayed above It is a pattern which, we think those familiar with p & f techmque Will agree, is, at least potentially, ommaus. The saving grace at the moment is the fact that the average has not yet performed the final action necessary to suggest that the pattern OlIght be a distributtonal top. a decISive downside breakout. The proper mterpretation of this trading range is, we thmk, the most critIClai task facmg the market techniCian today. We Will attempt to assay such an interpretation in our 1992 forecast. ANTiiONY W. TABELL, CMT Dow Jones Industnals (1200) 2919.05 DELARELD,HARVEY,TABELL Standard & Poors 500 (1200) 384.58 Cumulative Index (12/12/91) 6341.78 No stalementor e)(presslon of opinion or any other matler herem contained IS, or IS to be deemed to be, directly or Indirectly, an offeror the sohcltatlon of an offer to buy or sell any secunty referred to or mentroned The matter IS presented merely for the convenience of the subscnber 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 herem Any action to be taken by the subscnber 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 later take, poSitions or trades In respect to any seCUrities menhoned In thiS or any future Issue, and such pOSition may be different from any views now or hereafter e)(pressed 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 olher customers Independently of any statements made In thiS or In any oher Issue Further Information on any secunty mentioned herein IS available on request