Subject: File No. S7-14-08
From: Tom Byrne

November 4, 2008

NO SEC regulation.

Indexed Annuities are not Securities as they are not traded, carry no investment risk and are guaranteed by the Insurance Carriers.

Many indexes are used to determine the yield on financial instruments:

10yr Note for Mortgages: A mortgage is NOT a Security even though Notes are traded on exchanges.
Cost of Living/Inflation Index: Social Security is an annuity type program tied to the COL.

Key element is that there is NO market risk in Indexed Annuities. They are not Liquid and are not Exchange Traded. They are contracts between an insurer and a Purchaser.

Index Annuities function like CD's. CD's are tied to the Fed Funds rate and have no market risk.

This appears that the SEC has a conflict of interest in attempting to regulate a non security product and eliminate Insurance Producers from selling the product which for so many years has been a product the Insurance Industry developed and is backed by the Insurance Carriers.

State Regulators/Insurance Carriers should continue to oversee and enforce compliance.

Respectfully,

Tom Byrne