Why do tribal casinos pay so much to borrow?

The study of lending markets often overlooks borrowing by tribal governments as well as borrowing by tribal casinos. This is a relatively small part of bond markets, and lending markets more generally, but it raises important questions. For instance, it seems to us that tribal casinos -- at least the handful for which we have seen bonds and yields – pay more to borrow than non-tribal casinos. Does the difference reflect perceived credit risk? The legal uncertainties about lending to tribal entities? In this era of ESG, should investors consider whether these loans help achieve tribal development objectives? Our guest is Dave Jordan, of the Wisconsin pension fund, and he tries to educate us about the ways of this market.

Producer: Leanna Doty