EARLY BIRD TIP

Nearly everyone's heard the saying" What goes around comes around. If you're looking for, to use another familiar phrase, the proof of the pudding, look no further than Wall Street and their recent push to revamp one of the banes of last time out--revamping no doc real estate loans.

Yes, they're back those big money managers, the likes Blackstone, Neuberger Berman and Pacific Investment Management, doing what they really do best--lobbying for special advantages to make tons of money with something called "Alt-A" loans, mortgage paper that offers higher payouts on loans, the WSJ reports today.

The average 30-year paper yield rates around 3.8% whereas many Alt-A stuff offers yields as big as 8%, according to the Journal. In the current-starved-for-yield environment that's an enticing menu to many investors, individual and institutional. Think about, for example, insurance companies and state retirement funds, many already underfunded, with huge fixed costs.

If you think hard enough you should reach two conclusions thanks to the Fed's long and lonely for investors on fixed incomes love affair with ZIRP, enticing the bait to take on greater risks and setting the blocks in place for another systemic financial castrophe. And for those big money managers the enticement is even bigger, bundling fees.

The twist here is, so the claim goes, none of these loans are being bundled. But to use another time worn saying: Necessity is the incubator of all creation and these boys and girls are word merchants of the highest order. Since "Alt-A" comes with a well-earned stigma, a name change is necessary. There's that word again.

Bet you just love this new one--"non-qualified mortgages" Here's the other tip off. By floating these farces money mangers are claiming "...they would reach an underserved corner of the housing market..." In this case, according to the WSJ, they mean people who " might be self-employed and report income sporadically."

Here's the end game in short. These folks never eat their own cooking and will find a way around it so that when the piper knocks on the door finally to be paid, they will not, rest assured, be holding any of this paper.

If it comes about and you want to play, take a tip from the early bird. Be early in and early out.