Dear Mr. Berko: I'm a conservative investor with an IRA worth $212,000. Of course, it was worth nearly $295,000 a couple of years ago. And I really need income in this low-interest-rate market. Over the past year, I've bought several of your high-income recommendations, and each has worked out very well. Could you please recommend another high-income issue that you like? I know I'm not the only one who reads your column in Gainesville who needs another high-income stock. So your recommendation would be doing me and other readers a big favor. — D.P., Gainesville, Fla.

Dear D.P.: Low CD rates, low savings rates, low T-Bond rates, corporate bond and money market rates are hurting most retired folks — putting bumps in their budgets, detour signs on their spending and tossing some curves at their Golden Years. We all know, considering the past record of a manic explosion of our money supply, that interest rates must rise again. But there are two $64 questions: (1) When will rates begin to rise and (2) how high will they rise? Well, only two people know that answer: Lloyd Blankfein, the CEO of Goldman Sachs, who bragged that he is "doing God's work"; and St. Peter, the CEO of Heaven, but they ain't talking — certainly not to me.

The consensus suggests that rates will begin to rise by late summer and that single-A corporates could yield 7.5 percent by this time next year. Certainly, the Fed's peregrinations and prestidigitations have managed to keep the door on interest rates closed. But the pressures are intense, and Uncle Ben (the head fed) realizes he must open the door a crack to let some of the air pressure out or burst the bubble that could force volatile rate spikes. It's a catch 44 (twice as bad as a catch 22) because he's damned if he does and damned if he don't.

So there's a foot race to buy high-yield paper. Investors will grab the hottest "stuff" — often not the best "stuff" — and, in the process, make some regrettable mistakes. But sometimes it's best to be late to the party because as my Dad used to tell me: "The second mouse safely gets the cheese."

Still, no matter how much I or others may wax enthusiastically about a high-yield investment, the fact that they have a double-digit yield shouts: "Be careful, I am dangerous!"

Well, one dangerous high-yield issue with which I am moderately comfortable is CHIMERA INVESTMENT CORPORATION (CIM — $3.90), a mortgage REIT, CIM began its tenure as a public company in September 2007 to surf the crests of easy credit. Back in early 2007, CIM was highly leveraged so that each $1,000 in capital allowed CIM to own nearly $4,000 in mortgages, and the stock was in the $17 to $19 range. And with that leverage, CIM was paying dividends of 12 percent to 14 percent.

But holy Geronimo, that was a sticky wicket. Less than a year later, CIM imploded, and in late December 2008, the shares closed at $2.88, an all-time low. Today's leverage is almost negligible at about .9 cents to the dollar.

CIM owns a huge portfolio of mortgage-backed bonds that has been marked to the market at about 50 cents on the dollar, which may be overly modest. However, the yield to those who buy CIM at its $3.90 price exceeds 17 percent.

These bonds can recover, perhaps not to par ($1,000), but CIM's portfolio has the power to gain 25 percent to 35 percent in value over the next couple of years. Meanwhile, the 64-cent dividend could be increased in 2011 because CIM must pay out 90 percent of its earnings.

The company has a $3.09 book value, $124 million free cash flow, profit margins of 90.3 percent, expects earnings of 59 cents in 2010 and between 64 cents and 69 cents in 2011. And along with improving earnings, the consensus believes the share price could increase by 50 percent or more in the coming two years.

Now, please remember, this is a speculative issue — very speculative — and like Puff the Magic Dragon, it could disappear into the ethers if the economy tanks again. So to be on the safe side, you should limit your position to 300 or 400 shares. Meanwhile, continue reading this column for additional high-yield opportunities.

Please address your financial questions to Malcolm Berko, P.O. Box 8303, Largo, FL 33775 or e-mail him at [email protected]. To find out more about Malcolm Berko and read features by other Creators Syndicate writers and cartoonists, visit the Creators Syndicate website at www.creators.com.