In a nod to the Trump administration, on which I am often very hard, I now understand why they would seek to impair parts of the US Semiconductor Equipment industry in the name of greater national interest. I bought Equipment company LRCX on the tank job that followed this news:
I was going to write a typical Trump-dismissive post about this a couple weeks ago when an NFTRH subscriber, an accomplished long-time mutual fund manager, took issue with my stance. Turns out he was right and I was not seeing the forest for the trees.
I went rummaging around the technology space this morning and found this excellent source of information to be added to my usual source, SEMI (which frankly feels like a bit more of an industry cheerleader in comparison to CSET linked below), where Semiconductors are concerned. I’ve linked it at NFTRH.com’s links page for future reference and here is a direct link.
What caught my attention was this report. You can click the image for the full PDF report.
Here’s one snippet, and to be clear I agree with its premise. In this case protectionism is warranted. People may think the US is powerful because of its ability to disintegrate the world however many times over. But it is Technology that is the real strength.
The fact that the complex supply chains needed to produce leading-edge AI chips are concentrated in the United States and a small number of allied democracies provides an opportunity for export control policies.
I have only given this report a brief skim but there are other important aspects, like the waning of Moore’s Law in technology. The process actually rhymes with a coming cost-push inflationary phase.
Check this out. Chip prices have increased for the first time since 2004 or probably forever. That means that efficiencies have failed for the first time to keep inflation from showing up in progressive technologies. It’s interesting, anyway.
I am going to save the report for future reference, along with the link to CSET for the same reason. I’ve learned a lot already, including about my own relatively cartoon-like view of the Trade War as applies to Semiconductors. That’s what life is I guess. We learn, learn and learn some more. Then we die.
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