By Anthony Burke Boylan – If ever an investment could be called a gamble and a reclamation project, this has to be it.

Soon investors will be allowed to purchase toxic mortgage-backed assets – the very ones that nearly brought down the banking industry – for their very own. Shares of these assets are expected to go on sale next month through BlackRock Legacy Securities Public-Private Trust.

As taxpayers, we already have exposure to and bear the costs of these assets. Those costs are expected to go way beyond the $700 billion cost of the TARP program – as high as $2 to $4 trillion by some estimates – and also are manifested in lower home prices, tighter credit, a shrinking job and wage market, the lowered value of your bank stocks and mutual funds, and many other tangible and intangible economic impacts.

So buying your very own slice of this pie sounds riskier than doubling down on a six.

Then again, there are times you are supposed to double down on a six – such as when the dealer is holding one, too.

If you aren’t a gambler, a six is the worst card a black jack dealer can show for the house. It’s a bad card for the player, too, but worse for the dealer. Because of the probabilities of the game, a player is advised to double his bet when both he and the house hold sixes.

And by comparison it seems both institutions and investors are holding sixes right now.

The Public-Private Investment Partnership was founded earlier this year to allow banks to raise capital to help their sagging bottom lines while unloading distressed assets and giving investors open to risk a chance to profit.

Investors will benefit not only from the desperation of the banks, but from a subsidy by Uncle Sam. The government will contribute $1 in equity and $1 in debt for every dollar invested.

And while investors have more questions than answers right now, banks are holding a fistful of sixes for sure.

·         Almost universally banks are in need of a cash infusion and they have far fewer options to raise capital than in normal times.

·         Due to aggressive regulators, bad loans have been written down to levels that make them attractive. Banks would like to hold onto them to reap the benefits of an improving economy – whenever that happens – but may have to take the cash now.

·         Mortgage Backed Securities continue to worsen. Nearly 7 % of prime mortgages now are delinquent, 21% of Alt-A mortgages and 40% of sub-prime, with no reason to think they will get better soon.

In other words, banks are in a position to deal and it could be a buyer’s market.

Of course there are plenty of reasons for concern. These assets are discounted with upward potential, but the discounts come from inherent risk due to an economy that may or may not improve anytime soon. Most experts agree the employment picture is expected to deteriorate throughout the year, and a full-blown recovery can’t happen until jobs grow again.

The industry cleanup isn’t complete. Congress may have more hearings, more controversy could erupt over bailout plans, and new problems may be on the rise.

BlackRock is backing PennyMac Mortgage Investment Trust, for example, in raising money through an initial public offering this week. PennyMac is run by the alumni of Countrywide Financial Corp.

So in other words, the people who brought you the sub-prime mortgage crisis, and whose former colleagues are under lawsuit by the Securities and Exchange Commission, now are about to profit from the mess at hedge fund profit margins.

Like doubling down on a six, you should do it with money that it would be nice to double, but you don’t need it for necessities.

Just remember, the advantage always goes to the house and the drinks aren’t really free.