Subject: File No. S7-35-11
From: Michael O'Connor

September 3, 2011

I have easily found through my due diligence that:
1.  Mortgage REITs are not mutual funds.  Nobody who is familiar with Internet and knows how to read should be confused on this issue.  Additionally, Mortgage REITs clearly act and trade like stocks.
2.  Again, nobody who is familiar with internet and knows how to read could believe that Mortgage REITs are closed-end funds, open end funds, or ETFs.  Mortgage REITs invest in pools of MBS and use leverage with their capital to produce enticing yields.  They also hedge interest rate and credit risk through the use of derivatives.  This business model is about as simple to understand as any that I have encountered.
 3.  I can assure you that I do not feel the need for more government regulation/oversight of the mortgage REIT sector.  In fact, the only major concern I have with investing in this sector has been caused by your unnecessary and destructive investigation.  As a result of your actions, I am now considering abandoning what was previously one of the safest and most stable investment vehicles available to individual investors like me.  
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 4.  I respectfully request that you rescind your investigation of Mortgage REITs.  I see no reason for undoing exemptions dating back 71 years under the Investment Company Act of 1940, or for changing your interpretation of the 1960's legislation creating REITs (designed to help small investors, not big institutions).
Michael O'Connor