The hunt for yield is taking Wall Street and investors into exotic territory—and that means an appetite for credit assets that are private, not easily tradable and often complex.

Shorter, investors blindly betting on opaque securities.

Putting together deals in what some dub “nonlinear finance” is a growth business for investment banks’ big bond-trading arms and is helping clear unwanted assets off some balance sheets.

Wall Street is back to telling stories about what the value of these opaque securities might be.  At the same time, Wall Street is loading up these securities with unwanted assets that carry much more risk than implied by Wall Street’s valuation story.

Like subprime mortgage based securities, over the long run, this too will not end up well for the investors.