Spoiler warning: If you have not read Watchmen, do not read these notes. See intro/disclaimer.
Cover: The cover image is of an angel statue in a graveyard. The statue has a raindrop over its right eye, like the blood drop on the right eye of the button. The shape is somewhat similar, too, although if it was intentional, it's not so blatant.
Page 1, panel 1: This chapter engages in a lot of panels with dialogue from one scene serving double-duty as narration for another scene as we cut back and forth. Essentially every piece of dialogue in California refers in some way to the New York picture behind it in the alternating frames. Here, Sally's reference to "the city of the dead" is superimposed over a cemetery.
Page 1, panel 4: Oddly enough, although Laurie's vomiting is often mentioned, nobody else seems to report this effect.
Page 1, panel 8: Sometimes, the California panels have subtle references as well. The picture was of course taken the day of the incident being discussed.
Page 1, panel 9: "It's history." While this line is most obviously another pun-like reference to Eddie's death, there are more subtle things going on here, such as the flag-draped coffin which represents both U.S. history, and Eddie's part therein. More interestingly, this is one of many panels in which Jon seems to be looking around nervously (19.5 being one of the most obvious, panel 7 on this page being more subtle). There are at least two of people at the funeral with whom Jon has "history," but he only vaguely recognizes them, if at all, since both are in disguise. (Although Jon is often referred to as being godlike, he is certainly not omniscient, remembering only events he has seen personally.)
Page 2, panel 1: The words "perspective" and "smaller" subtly reference the odd framing of this panel, in which a higher angle makes Laurie and Sally appear smaller. Note that Sally has a medical chart at the foot of her bed; is she in a retirement home or a hospital? Probably some combination.
Page 2, panel 2: "In the end, you just wash your hands and shut it away." superimposed on the dirty hands of the doomsday prophet, while somebody shuts the gates of the cemetery.
Page 2, panel 4: "Life goes on." while we see various indications to the contrary.
Page 2, panel 6: Laurie assures her mother that it's sunny in New York, but it's clearly anything but.
Page 2, panel 7: Sally's retirement home is called Nepenthe Gardens. "Nepenthe" is a term from the Odyssey meaning "one that chases away sorrow". In that story, it referenced the destruction of painful memories with forgetfulness, which is essentially what they've been talking about so far.
Page 2, panel 8: "I mean, without your health, where are you?" In a cemetery, natch.
Page 3, panel 1: One might wonder how Dan really thought he was keeping his identity a secret given the company he's keeping here. Note that in addition to not feeling the weather, it appears the rain doesn't touch Jon. The rain also doesn't touch Adrian, but because of a different sort of power he has. As much as these four men (counting the Ediie in the casket) have in common, this picture shows how different they really are in the end. While the title of the chapter "Absent Friends" seems rather appropriate to this panel, there's actually an odd irony to it, as Eddie is the only one "Absent", while almost all of his "friends" (a stretch of the term) are present.
Page 3, panel 2: So Mothman is "in the bughouse"? A tacky pun, but it fits with Sally's personality. As she recalls the past, we see a bottle of "Nostalgia" before her.
Page 3, panel 3: Aside from the obvious reference to being buried, Sally refers to Eddie being "on top of it", as the American flag (upon which Eddie's costume was modeled) is put on top of his coffin.
Page 4, panel 2: The first comic-within-the-comic. "Tijuana Bibles" were a very genuine phenomenon in the real world, and Sally being the subject of one shows that she must have once been rather famous.
Page 4, panel 4: Again, no exaggerating on anyone's part here: Tijuana Bibles are valuable collectibles, and the content within was usually far more hard-core than one might think a fad from the '30s and '40s would be.
Page 4, panel 7: The past "just keeps getting brighter all the time." Perhaps only a reference to the glint of light off the picture frame, but each of the flashbacks in this chapter have a prominent theme of light vs. dark, flashes of light, fire, and explosions.
Page 4, panel 8: The first of several flashbacks in this chapter (starting with an actual flash in the previous panel; do people still use the term "flashbulb memory"?), all revolving around character development for Eddie Blake. Note that the older the flashback, the rounder the dialogue bubbles are. I've no idea what the significance of that would be, but it's definitely noticeable.
Page 5, panel 1: Headline about Plutonium in the paper. If the calendar is indicating October of 1940, this discovery is a few months early in their world.
Page 5, panel 3: The Comedian is eager to be involved in war, as indeed he later was in both WWII and Vietnam (at least). Hooded Justice gets interrupted by Silhouette (her only line of dialogue in the whole book - a not-at-all-subtle jab at recently-invaded Poland); what was he about to say? Hollis claims in his book that Hooded Justice was in favor of the Third Reich. (Under the Hood, p.8)
Page 5, panel 4: As we know from the previous chapter, Sally is Polish, but pretends not to be. Byron, while happy to fight crime, is clearly not so happy at the prospect of fighting wars.
Page 6, panel 4: Compare this panel to 14.7; Eddie is injured by his right eye.
Page 7, panel 6: Compare this panel to I.3.3. This is another mention of the concept of the superhero as sexual fetishist, and it may not be an idle comment by Eddie, as Sally's scrapbook on page 31 of chapter IX mentions that "H.J." is always "out with boys, and apparently there's a lot of rough stuff going on."
Page 7, panel 8: See Adrian's comment in XI.18.4-8: did Eddie make good on his promise and kill Hooded Justice? Note the position and shape of the bloodstain.
Page 7, panel 9: Note clock at five to midnight.
Page 8, panel 1: While in public, Hooded Justice is supposed to be Sally's boyfriend, there is clearly no actual affection between them.
Page 8, panel 2: Note that the content of the comic ironically parallels the scene in the flashback. Also, just as Hooded Justice's comment seems to imply Sally was partially responsible for her own rape, here Laurie's comment seems to imply her being partially responsible for the content of the comic.
Page 8, panel 3: While Laurie's lecture is still obviously about the comic book, with Sally still thinking about the past, there is a continued parallel to Hooded Justice's rebuke.
Page 8, panel 5: Headlines on the cover of Nova Express indicate as already hinted that Richard Nixon is still President. Assuming he was first elected in 1968 as in our history, this would imply he is currently serving his fifth term. Elsewhere it is briefly implied that in Watchmen's parallel history, the U.S. Constitution's 22nd Amendment was overturned in 1975. (See IV.21.1 and XI.30.)
Page 8, panel 6: This is the first discussion of Jon's true role he plays for the government: not merely a superhero, but a key component of the Cold War arms race. Of course, this is most thoroughly examined in the addendum to Chapter IV. The "Varga" of the pin-up poster on the wall is no doubt Alberto Vargas, one of the most popular pin-up artists of the '40s, if not all time. That Vargas would have painted Sally is yet another indication of her fame and iconic status as a sex symbol.
Page 8, panel 8: As Sally closes the scene with an old proverb about rain, we cut back to the rainy day in New York.
Page 9, panel 1: In the midst of one of the few breaks of the standard nine-panel format, Adrian stares intently at nothing at all. One might wonder, given what we know about him in the end, what he might be thinking of throughout most of the funeral.
Page 9, panel 4: While in the previous panel, God is "justly displeased"..."for our sins", Captain Metropolis feels quite differently. Is this just the use of parallel phrases to make a transition to the flashback, or is there an implication that there is something deeply, inherently wrong with costumed vigilantism?
Page 9, panel 5: Nelson Gardner introduces "the first ever meeting of the Crimebusters!" He's obviously enthusiastic, but due to a comment made by Dan in Chapter VII, I suspect this was probably also the last meeting. This scene being about 19 years before the main story gives us some interesting contrasts. Jon is still with Janey Slater, but he keeps staring at Laurie; he knows where his future lies, including of course how this meeting ends. At this point in time, he wears clothes. While the Eddie (in his new costume) was interested enough to show up for the meeting, that seems to be about the extent of his interest, as he largely ignores Nelson and reads his paper. (Actually, both he and Jon may have been ordered to go to the meeting by the government.) The smaller headline reads HEART TRANSPLANT PATIENT STABLE, another indication of the differences in scientific advancement between our world and theirs, as in the real world, a successful heart transplant wasn't performed for about another year and a half. Rorschach looks relaxed and clean, a huge contrast from 1985.
Page 10, panel 1: Another clock at five to midnight.
Page 10, panel 2: Nelson thinks the Crimebusters should be fighting "PROMISCUITY", "DRUGS", and "CAMPUS SUBVERSION"? See 11.4 for more of Nelson's "evils".
Page 10, panel 5: Note the dialogue bubbles imply that Rorschach talks normally in 1966.
Page 11, panel 1: One could say that this is Adrian's "Mission Statement".
Page 11, panel 2: Rorschach is the positive, encouraging one here?!
Page 11, panel 4: Nelson also considers "ANTI-WAR DEMOS" and "BLACK UNREST" to be "evils" the Crimebusters should be taking care of.
Page 11, panel 7: "Somebody has to save the world..." Adrian's epiphany.
Page 13, panel 1: In this world, (thanks in no small part to Dr. Manhattan) the Vietnam War ends with American victory in June 1971 instead of defeat in 1975.
Page 14, panel 7: Once again, Eddie is injured under his right eye, and a blood drop falls on the right eye of his button.
Page 15, panel 4: Eddie seems to understand Jon better than most.
Page 17, panel 4: Clearly Eddie enjoys violence.
Page 17, panel 6: Barely-seen newspaper blows past the Owlship with headline: COPS SAY: "LET THEM DO IT". The riot is due to a police strike, which is due to the "superheroes".
Page 19, panel 4: This is Moloch placing the flowers.
Page 20, panel 2: Another headline about Afghanistan.
Page 20, panel 5: Pizza boxes, etc. unnoticed by Moloch.
Page 21, panel 6: Even Rorschach didn't know the Comedian's real identity.
Page 22: This two-page spread contains a lot of oblique clues to later plot developments, of course. This odd alternating lighting is from the neon sign of the comics shop "Rumrunner" next door, as seen in Chapter V, and sets up the pacing of the narrative nicely.
Page 24, panel 8: Rorschach can be cruel, but he's not completely heartless.
Page 25, panel 1: Sex show "Enola Gay and the Little Boys"? Enola Gay was the name of the bomber that dropped the atomic bomb on Hiroshima. The bomb itself was known as Little Boy.
Page 25, panel 3: Although criminals, apparently prostitutes don't fear Rorschach.
Page 25, panel 6: "Nothing is insoluble." Reference to the Gordian knot?
Page 25, panel 7: "Not while there's life," Rorschach says as he enters a cemetery.
Page 26, panel 4: Like the opening sequence, Rorschach's narrative fits the pictures behind it.
Page 29: Under the Hood by Hollis Mason, continued. Hollis fills in some holes in the history behind the story. I don't know if Alan Moore was the first to delve into this, but with this book being so "ground-breaking" this is probably one of the earliest superhero stories that goes into the processes of what it takes to become a masked hero. You don't just put on a mask and go hit bad guys, you have to think out a persona, design the look and composition of your costume, and make sure you're in top physical shape with above-average fighting skills. Also of note, it's possible that it's an error, but near the top of the second page, Hollis says, "[T]here were at least seven other costumed vigilantes operating on or around America's West Coast." (My emphasis.) If this is not an error, it implies that the eight heroes we see acting contemporaneously with Hooded Justice are just part of the overall story, as all the characters here are on the East Coast.
There is an interesting dynamic here, in that Hollis seems to be aware that there were superheroes that may have done it for a sexual thrill, and yet seems blissfully unaware of the fact that Hooded Justice was gay (and not just gay, but into kinky, violent sex, as revealed in the epilogue to chapter IX). One wonders what to make of the fact that while some people (including Hollis) seem to want to label the Silhouette as a pervert simply because she's homosexual, her first case involved breaking up a child pornography ring. Because of the Silhouette being outed as a lesbian by the media, the Minutemen expel her from their group despite the ironic fact that at least two of the six remaining members were also gay. Also, while we did not get a flashback from Hollis in this chapter, he does give an evaluation of the Comedian's character, and informs us of the early work he did for the government.
