What the 1MDB Scandal Can Teach Us About the Nature of Debt

Every week, hosts Joe Weisenthal and Tracy Alloway take you on a not-so-random walk through hot topics in markets, finance and economics.

At the heart of government debt is a promise to pay back creditors. But governments sometimes don't do this - either by defaulting on their bonds or restructuring their debt. How are these decisions made? And what happens to borrowings that governments say should never have been done at all? On this week's episode of the Odd Lots podcast, we speak with Mitu Gulati, professor of law at Duke University and one of the world's foremost experts on sovereign debt restructurings. We talk about the government debt connected to Malaysia's 1MDB scandal, as well as ongoing bond drama in Mozambique and Venezuela.

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