Bloomberg Surveillance Single Best Idea with Tom Keene: Dominic Konstam & Rohit Goel
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Oct 21, 2025 The discussion kicks off with a deep dive into shifting treasury demand and the dynamics of basis trades. Dominic Konstam highlights the growing role of banks and non-bank entities in purchasing treasuries. He also explores how policy changes could enhance liquidity and broaden the base of treasury buyers beyond traditional markets. Rohit Goel provides insights into India's economic trajectory, noting its historical fixes but cautioning against external political risks that could impact future stability.
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Host Introduces Guests And Thaler Mention
- Tom Keene recounts speaking with Richard Thaler about reissuing his behavioral economics book and asks about the Chicago Cubs.
- He then introduces Dominic Konstam, noting Konstam's Mizzou background and long Wall Street experience.
Shift In Treasury Demand Dynamics
- Dominic Konstam observes that traditional foreign demand for U.S. Treasuries is waning while non-bank financial entities and basis trades now hold large positions.
- He notes that banks and deregulatory pushes are absorbing supply, changing liquidity dynamics without extending duration risk.
Basis Trades Are Driving Treasury Ownership
- Konstam highlights that basis trades and non-bank financial entities are major treasury owners, creating liquidity risk distinct from duration risk.
- He suggests policy moves targeting repo could reduce hedge fund liquidity concerns and broaden treasury absorption.