Subject: File No. S7-25-06
From: Brian Loescher, CFA
Affiliation: Director of Alternative Investments, Arnerich Massena Associates

February 2, 2007

As a Chartered Financial Analyst and Director of Alternative investments for a multi-billion dollar investment consulting firm, I feel that I am in a perfect position to comment on the proposal to raise the minimum requirements for private fund investments.

In my extensive experience I have seen nothing to indicate that those of higher net worth are more capable of making better investment decisions than more actively involved smaller investors. In fact, if the new proposed limits go into effect, I myself would be excluded from investing in private investment vehicles (hedge funds) despite the fact that I spend my entire professional life devoted to understanding and making recommendations on these very investments.

My concerns go well beyond my own though, we are doing smaller investors a HUGE injustice by taking away a key tool in the process of building superior risk/adjusted returns. The fact that we have to provide lower level of service and end product to our smaller clients is an embarassement to the investment business. To create an uneven playing field, in fact a priveleged playing field for the ultra wealthy is so against everything our democratic society is built on.

The current regulation should be abolished and any investor willing to make the effort to understand hedge fund investments or anyone utilizing a professional advisor should be allowed to invest. If we don't bother to restrict option and futures trading (some of the riskiest investments you can make) why are hedge funds singled out?

End of the day, the vast majority of the hedge funds we invest in have profiles that actually are much more conservative than the long-only public equity markets and actually help protect investors from sharp market declines. They are unique, defensive tools that all investors should have access too.

Brian Loescher, CFA
Director of Alternative Investments
Arnerich Massena Associates