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Preheat over to 300 degrees. Cut or tear bread into 1 inch cubes and place in a 8-inch square baking dish; set aside.
Whisk together sugar, eggs, heavy cream, cinnamon and nutmeg in a large mixing bowl. Pour mixture over the bread cubes and press the bread cubes gently to submerge.
Sprinkle pecans and cinnamon sugar evenly on top; set aside for 10 minutes.
Bake for 40 to 50 minutes or until a knife inserted near the center comes out clean. Remove from oven and set aside to slightly cool.
Heat the heavy cream and vanilla in a medium saucepan over medium-low heat, stirring frequently, 4 to 5 minutes, or until simmering. Remove from heat.
Whisk the egg yolks and sugar together in a small mixing bowl until combined. Stir ½ cup of the warm cream into the egg mixture.
Whisk vigorously for 1 minute. Pour the egg mixture into the warm cream. Cook over low heat, stirring constantly for about 2 to 3 minutes, just until simmering.
Once mixture begins to simmer, stir well and cook for an additional 2 minutes. Remove from heat, stir in bourbon and strain.
To serve, spoon bread pudding into bowls and drizzle with warm bourbon sauce.