In a high-sided skillet over medium-high heat cook bacon until crispy, about 5 minutes.
Remove to a paper towel-lined plate.
Whisk the flour into the bacon fat and cook 1 minute then whisk in the milk and season with nutmeg, salt and pepper. Bring to a bubble and let thicken, about 3 minutes.
Pour into a fondue pot, top with crispy bacon bits and serve with your favorite breakfast dippers like pop biscuits, waffles, roasted baby potatoes, breakfast sausage links or anything else you can think of!