Add all of the ingredients except for the bourbon and vanilla extract to a saucepan. Bring to a full boil. Mash the cranberries with a fork and continue cooking at a gentle boil, stirring frequently, until sauce has thickened and cranberries have lost much of their form.

Remove sauce from heat and stir in the bourbon and vanilla extract (Note: if you want all of the alcohol to cook off of the bourbon, add it while you're cooking the cranberries). Transfer to a storage container. Refrigerate until ready to use.