A new report suggests that all three memory manufacturers — Samsung, SK Hynix, and Micron — have collectively sold through their 2027 memory manufacturing capacity to AI companies.
It’s because it’s a Ponzi scheme. Huge amounts of investment dollars are being dumped into AI and anything related to AI. If you build any kind of chips that are used in AI datacenters, you suddenly have a bunch of money invested in your company. What do you do with it? You make a deal with OpenAI (or one of the other ones) that you’ll invest that money into them if they agree to buy a bunch of chips from you. Now you have revenue on books and are showing a reasonable return on that investment.
If you were a chip manufacturer and actually believed that there was a big future in AI, you’d be using those investment dollars to build some more chip fabs. And some of these companies are doing that. But overall, moving money to another company so they will order chips for datacenters that aren’t built yet (and may never be built) is just bubble ponzi shenanigans.
Computer hardware depreciates in value very quickly. You don’t buy hardware today so you can install that hardware in a datacenter that won’t be online for another year.
Capitalists wet dream is to make more money without investing any new capital. Chip fabs are in a situation like that where they can make buttload more money without changing anything except charging more.
Nothing will change because the alternative is investing billions just to keep the price down. They’d rather pocket the billions now.
If you were a chip manufacturer and actually believed that there was a big future in AI, you’d be using those investment dollars to build some more chip fabs.
Major new semiconductor fabrication plant projects are expanding across the United States, led by a $16.8 billion SpaceX and Tesla “Terafab” project in Grimes County, Texas, massive expansions by TSMC in Arizona, and Samsung’s ongoing fab development in Taylor, Texas.
Computer hardware depreciates in value very quickly. You don’t buy hardware today so you can install that hardware in a datacenter that won’t be online for another year.
Hardly unusual for speculators to buy up a hot commodity the day of release and then resell it into an inflated secondary market a few days or weeks later.
And it has much more to do with defense industry senators brokering the deal than Biden’s presidency.
The Chips Act was in committee with bipartisan support before the election was decided. Senator Warner joined U.S. senator John Cornyn in introducing the $52 billion CHIPS for America Act was back in June of 2020.
Sure there’s plans, maybe even some ribbon cutting with some gold shovels to “break ground” or whatever. These are things you do when running a Big Store type of scam.
It’s because it’s a Ponzi scheme. Huge amounts of investment dollars are being dumped into AI and anything related to AI. If you build any kind of chips that are used in AI datacenters, you suddenly have a bunch of money invested in your company. What do you do with it? You make a deal with OpenAI (or one of the other ones) that you’ll invest that money into them if they agree to buy a bunch of chips from you. Now you have revenue on books and are showing a reasonable return on that investment.
If you were a chip manufacturer and actually believed that there was a big future in AI, you’d be using those investment dollars to build some more chip fabs. And some of these companies are doing that. But overall, moving money to another company so they will order chips for datacenters that aren’t built yet (and may never be built) is just bubble ponzi shenanigans.
Computer hardware depreciates in value very quickly. You don’t buy hardware today so you can install that hardware in a datacenter that won’t be online for another year.
Capitalists wet dream is to make more money without investing any new capital. Chip fabs are in a situation like that where they can make buttload more money without changing anything except charging more.
Nothing will change because the alternative is investing billions just to keep the price down. They’d rather pocket the billions now.
Major new semiconductor fabrication plant projects are expanding across the United States, led by a $16.8 billion SpaceX and Tesla “Terafab” project in Grimes County, Texas, massive expansions by TSMC in Arizona, and Samsung’s ongoing fab development in Taylor, Texas.
Hardly unusual for speculators to buy up a hot commodity the day of release and then resell it into an inflated secondary market a few days or weeks later.
TSMC was because of the Chips Act and it’s not DRAM.
TSCM’s Arizona plant was announced in May 2020.
And it has much more to do with defense industry senators brokering the deal than Biden’s presidency.
The Chips Act was in committee with bipartisan support before the election was decided. Senator Warner joined U.S. senator John Cornyn in introducing the $52 billion CHIPS for America Act was back in June of 2020.
Ah, so the only thing we know with confidence is that it’s definitely not happening.
Sure there’s plans, maybe even some ribbon cutting with some gold shovels to “break ground” or whatever. These are things you do when running a Big Store type of scam.