Has There Really Been a Russian Default?

The 30-day grace period recently expired on Russian bond payments due in May, and the Russian government also failed to make a late-June payment deadline on other bonds. That's a default, right? We keep getting asked that question, and we keep answering something like: "Yes. Almost certainly. It probably is almost definitely a default." And then we get strange looks. Do the sanctions imposed by the U.S. and other countries really prevent bondholders from receiving payment? Does a bondholder who opens an account to receive rubles violate the sanctions? If the answer is no, does giving bondholders this option mean Russia hasn't defaulted? If the answer is yes, do the sanctions let Russia off the hook, giving it a defense -- impossibility -- to bondholder lawsuits? And what's the point of all these sanctions anyway? We tackle these and other questions.

Producer: Leanna Doty