from Hacker News

The American chip industry’s $1.5T meltdown

by naves on 10/25/22, 6:20 PM with 46 comments

  • by wing-_-nuts on 10/25/22, 8:59 PM

    Honestly? The world's chipmaking should be more decentralized simply from a national security perspective. One needs to only look at the effects of sanctions on russia, once one of the world's preeminent superpowers, now lacks access to chips to such a degree that they're repurposing hugely expensive surface to air (s3-400) missiles for ground attack and relying on iranian drones for precision attacks.

    The fact that china could reduce 63% of the world's chip making capacity to rubble at a whim is a strategic threat to the global economy. This is one area where we could absolutely use some redundant supply, even at the cost of taxpayer dollars.

  • by neogodless on 10/25/22, 6:45 PM

    Previously discussed: https://news.ycombinator.com/item?id=33244767

    2022 October 18 (7 days ago)

    285+ points, 679+ comments

  • by adventured on 10/25/22, 6:58 PM

    > Half a year later the dreams look nightmarish. Demand for silicon appears to be falling as quickly as it had risen during the pandemic.

    The article is remarkably ignorant of history. Nightmarish is a absurd exaggeration. With the semiconductor industry, you must invest heavily during any downturn to properly reap the rewards during the inevitable good years. Rinse and repeat across decades.

    > So far this year more than $1.5trn has been wiped from the combined market value of American-listed semiconductor companies

    Which has only somewhat to do with the semiconductor industry and everything to do with the hyper overvaluation in nearly all asset classes thanks to the Fed's prior, prolonged, low rate program. Just ask the cloud stocks (smashed), or eg Microsoft (which all by itself is missing ~$720 billion off its market cap high). Tesla has been slashed in half, it's missing nearly $700 billion all by itself too. The examples of market cap destruction in the stock market are plentiful.

    > In late September Micron, an Idaho-based maker of memory chips, reported a 20% year-on-year fall in quarterly sales.

    Oh no, what ever will Micron do. It's a true nightmare. /s They have been around for 44 years and are doing quite well. Micron understands market swings, they have lived through many of them. So have AMD and Intel.

    This article is one big click-bait, scaremongering nothingburger.

    The only thing worth considering at this moment for the US semiconductor industry, is how much more should be invested than has already been allocated. The US Government should probably put tens of billions of dollars more into the pot for advancing semiconductor R&D, training labor, partnerships with universities, et al.

    > It is enough to keep you awake in terror at night.

    No.

    You can be certain that this article is a particularly wonderful indicator of the exact opposite as to what is going to actually happen. ~6-10 years from now the US semiconductor industry will be stronger than ever and will still tower over China's badly flailing efforts at forcing a semi industry into existence.

  • by marricks on 10/25/22, 9:00 PM

    Wasn't this foretold during the chip shortage by most articles written about it? That there'd be a down turn and everyone would have over invested in building new plants? Even worse because the fed is terrified of inflation / higher labour costs the US government is basically causing the melt down.

  • by bee_rider on 10/25/22, 9:28 PM

    Since the semiconductor industry is known to be boom/bust, I don't know why the US government doesn't have an official, automatic countercyclical spending policy... Micron down 20% YOY? Surely some supercomputer centers could use RAM...

  • by ChrisArchitect on 10/25/22, 9:35 PM

    [dupe]

    Plenty of discussion over here 8 days ago: https://news.ycombinator.com/item?id=33244767

  • by singingwolfboy on 10/25/22, 9:07 PM

  • by legitster on 10/25/22, 7:28 PM

    Aren't these comparing different product segments?

    Okay, consumer processor chips are down from their work-from-home/bitcoin boom. But I was under the impression that these new factories were focusing on industrial inputs - microcontrollers and such.

  • by tester756 on 10/25/22, 7:31 PM

    Semico stocks are basically on discount now

  • by animitronix on 10/25/22, 11:20 PM

    Yet we still can't find raspberry pis anywhere. I call BS on demand being down.