I'm not very good at ELI5, but briefly: all debt is a liability on one balance sheet, and is therefore an asset on someone else's balance sheet. That's an acc

I'm not very good at ELI5, but briefly: all debt is a liability on one balance sheet, and is therefore an asset on someone else's balance sheet. That's an accounting identity. If you go belly-up and can't pay your debt, then the financial asset disappears from the other balance sheet as well. Poof. Picture owning $100,000 in bonds of a company that goes bankrupt. One day you have a net worth of $100,000, the next day it's gone.