I'm kinda of shocked that chip & many tech companies play ball..
They are a required / no alternatives industry by so much of the USA, with limited alternatives. Is it really more cost-effective for each of these companies to spend hundreds of billions of dollars to avoid tariffs when they could easily pass on these costs because we have no alternatives?
Fortunately for TSMC, Intel really isn’t worth that much anymore. $50B doesn’t seem so bad, and maybe it could lead to a deep partnership and sharing of tech and factories.
If tariffs really raised money in the way Trump pretends then the US government could surely just grant Intel a direct share of all tarrif revenue raised from sales in to the US from Tawain?
Of course the reality is you're just taxing Americans to subsidise Intel at that point, since tarrifs are a tax on Americans and not foreigners.
So it really does raise money like trump "pretends"? Unless global trade ends, those tariffs will raise lots of money for the government. Even if it is the american consumer who ultimately pays the tariff.
Taiwan is under a tremendous pull by China, both non violent and violent. Any push by the US is a push towards China.
Trump has no idea what he is doing. HE can not replace Brazilian coffee, but at least it is "only" coffee. Not being able to replace a fab is a precarious situation.
Is he imagining invading Taiwan? China would consider that an invasion to its territory.
Tariffs kinda make sense when you have a deficit in a widely available item. Big trade deficit with Bangladesh? Sure you can buy cheap textiles from Thailand or Vietnam or something.
Unfortunately this approach does not work when you lack a viable domestic alternative and you're up against a monopoly.
What will the US do if TSMC does not blink? Not buy TSMC made chips? Obviously that is impossible, so the logical conclusion is that American consumers will end up paying the tariffs.
It occurred to me that tariffs are really a backdoor way of introducing consumption tax (aka sales tax, VAT, etc). It has been a conservative policy goal for many years, as the conservatives believe that income tax penalizes entrepreneurship, but the politics make it virtually impossible to switch to because consumption tax is regressive, and it is a huge change. The tariffs debate and the general political atmosphere created a misdirection, resulting in both income and consumption tax being with us now.
The next development will be the politicians discovering to their horror the high levels of taxation, and abolishing the income tax. Brilliant!
> Tariffs kinda make sense when you have a deficit in a widely available item. Big trade deficit with Bangladesh? Sure you can buy cheap textiles from Thailand or Vietnam or something.
Unprecedented rapacity by the United States - not only forced tech transfer, and then having to pay for the privilege of being robbed; the hegemon is consuming its vassals, as it withdraws from its commitments.
Trump's tariffs forced a historic trade deal between Japan, China, and Korea, three countries that historically hate each other. If Trump managed to accidentally force Taiwan and China to settle their differences, it might be a sign of the rapture.
I understand the push to build fabs in the US to avoid tariffs, as the US likely sees this as a strategic hedge for the global chip supply in case China disrupts Taiwan or Japan, or some other rare catastrophic event occurs.
Whether it is correct or not, Trump seems to view the US as a larger version of Mar-a-Lago, so he'll always feel he can charge a premium for access to its consumer base and market while offering discounts to those he sees as ingratiating themselves.
But it is supposed to be a free market that should reward efficiency and competence, not prop up companies that don't have their act together. If the goal is domestic chip production, funneling funds to TSMC's proven fab operations and to build more US fabs makes more sense than bailing out Intel, regardless of whether it is improper to demand such concessions at all.
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[ 28.2 ms ] story [ 1264 ms ] threadThey are a required / no alternatives industry by so much of the USA, with limited alternatives. Is it really more cost-effective for each of these companies to spend hundreds of billions of dollars to avoid tariffs when they could easily pass on these costs because we have no alternatives?
Of course the reality is you're just taxing Americans to subsidise Intel at that point, since tarrifs are a tax on Americans and not foreigners.
So it really does raise money like trump "pretends"? Unless global trade ends, those tariffs will raise lots of money for the government. Even if it is the american consumer who ultimately pays the tariff.
Trump has no idea what he is doing. HE can not replace Brazilian coffee, but at least it is "only" coffee. Not being able to replace a fab is a precarious situation.
Is he imagining invading Taiwan? China would consider that an invasion to its territory.
Unfortunately this approach does not work when you lack a viable domestic alternative and you're up against a monopoly.
What will the US do if TSMC does not blink? Not buy TSMC made chips? Obviously that is impossible, so the logical conclusion is that American consumers will end up paying the tariffs.
What exactly does this acomplish?
Yes.
> Obviously that is impossible
I assume you're willing to short Intel at this point?
Did we learn _nothing_ from the 2008 subprime mortgage crisis? Let them fail.
idk how we got to do this, like single producent of high end chips is not good for everyone
Whether it is correct or not, Trump seems to view the US as a larger version of Mar-a-Lago, so he'll always feel he can charge a premium for access to its consumer base and market while offering discounts to those he sees as ingratiating themselves.
But it is supposed to be a free market that should reward efficiency and competence, not prop up companies that don't have their act together. If the goal is domestic chip production, funneling funds to TSMC's proven fab operations and to build more US fabs makes more sense than bailing out Intel, regardless of whether it is improper to demand such concessions at all.