4 ms·

I'm starting to think it's a good idea to stock up on all the electronics you think you might need for the next decade. Because when China finally invades Taiwa

I'm starting to think it's a good idea to stock up on all the electronics you think you might need for the next decade. Because when China finally invades Taiwan, the supply of electronic devices worldwide is going to instantly disappear. How many electronic devices do you own that don't have any part of their supply chain in China or Taiwan or adjacent countries? The COVID shortages we all saw were practically business as usual compared to what may soon come... I'm wondering what contingency plans US companies have for this? It seems to me like Apple would be screwed. Microsoft's hardware businesses would have problems. Google and Meta and Amazon are probably OK, though it may be tough to build and maintain datacenters, but everyone will be in the same boat.

olladecarne 4y ago
Lack of high end tech will be the least of your problems if China and the US get into a hot war.
- tshaddox 4y ago
  Or at least, it’s not obvious what electronic devices you actually would need if the supply was going to get cut off for ten years.
- hotfix12 4y ago
  Why would China and the US get into a hot war anyway?
  - Spooky23 4y ago
    They aren’t. China needs the US more than the inverse
  - kelnos 4y ago
    It's unclear whether the US would deploy its own military to protect Taiwan in case of a Chinese invasion... but it could happen.
- kilroy123 4y ago
  Right, that's what I was thinking. This would mean catastrophic economic damage. Likely, would be far worse than the great depression. We important so many goods from China.
collsni 4y ago
Thinking the exact same thing. Jumping in on the new Ryzen socket.. gpu is yet to be determined.
crisdux 4y ago
I thought the same thing today after reading this Credit Suisse analysis from Zoltan Pozsar. https://news.ycombinator.com/item?id=32633505 https://news.ycombinator.com/item?id=32633505
alphabetting 4y ago
The supply of TSMC chips won't disappear bc the US will defend Taiwan. It's far too important. The companies with major reliance on mainland China (Apple) are the ones that need to worry.
- modeless 4y ago
  You really think TSMC will be able to fabricate and export chips at a significant fraction of full capacity during a war with China?
  - kman82 4y ago
    Probably yea
    - colinmhayes 4y ago
      A Taiwanese war immediately means a naval blockade, the us won’t be able to lift it with any certainty. There is 0 interest in a hot war with China among Americans. I doubt we’ll see any American military action that could lead to a deployment other than naval.
      - happyopossum 4y ago
        > I doubt we’ll see any American military action that could lead to a deployment other than naval. Err, you other points aside - that's how you'd contest a nail blockade, with an opposing naval force.
        colinmhayes 4y ago
        Outright sinking more than a couple Chinese naval vessels would lead to a conflict Americans aren’t interested in.
        alphabetting 4y ago
        The US government is more than willing to go to war to keep the world's chip supply out of China's hands. They're also pretty good at ginning up support back home.
colinmhayes 4y ago
The contingency is the chips act building more fabs in the us.
- alphabetting 4y ago
  CHIPS bill is a decent start but there is no replacing TSMC. A $50B watered down investment into US chips is small potatoes in grand scheme of things. Consider Apple spent $275B building up Chinese manufacturing to gain access to their market.
PheonixPharts 4y ago
My other concern is the collapse of the tech sector in a few months. I'm roughly 80% certain I'll be subject to layoffs in October (though all my coworkers are clueless), and I don't think it will be anywhere close to as certain I can find a new job as during the pandemic (then for every one company doing layoffs there were two with "unprecedented-who-could-see-this-might-end" growth). Lot harder to justify a new PC when no longer receiving a paycheck, though it will likely be even more important to have one then. Just got a new System76 machine and I have to say, I'm really loving it. Hard times ahead, unfortunately after that, it's even harder times.
- Zircom 4y ago
  Why is the tech sector about to collapse?
  - nikanj 4y ago
    Rent, gas & food are soaking up all disposable income, so B2C is toast. B2B is selling to the B2C, so their customers are going away.
  - PheonixPharts 4y ago
    There are basically two types of companies in tech: a.) companies that don't make a profit, and b.) companies that make a profit from those companies. As an example just consider every startup is basically in category A, and Amazon's most profitable sector, AWS, in category B. For more than a decade money was more or less free and the only sane choice for investors was to pour cash into anything that might one day get big enough to magically flip the profit switch and make a huge amount of net positive revenue. I thought the pandemic would be the end of the tech boom, but I was wrong. Not only did more money get pumped into the market but into consumers wallets as well. This led to extremely rapid expansion in the tech industry as investors were willing to pump even more cash into any company (hoping for a rapid IPO and a the ability to cash our there chips before the casino closed) and consumers had a surprising amount of extra cash lying around from being locked up for months. Unfortunately reality has started to show it's ugly face. Inflation is starting to hit hard, not because of the money supply, but because we are hitting some real resource limits due to a combination of supply chain problems and the Russian war with Ukraine (which, to be fair, is also happening because of resource strain). These are not temporary causes of inflation. This has caused the central banks to rapidly attempt increase interest to combat this inflation. Ending the era of cheap cash. This is coupled with the fact that things cost more so consumers also can't spend as much (even though they are also taking on more debt then ever, an unsustainable trend). Sure inflation is cooling a bit but that's largely because of a drop in oil prices (at least in the US) which is a political play from the democrats resulting the record low strategic oil reserves in the US (since 1984) [0]. This cheap oil cannot be sustained and will end after the next election cycle. The immediate impact of all of this is that direct to consumer companies are seeing an immediate hit (e.g. streaming service subscribers are churning faster than ever). Then non profitable ad revenue companies start to take the hit (see Snap's layoffs today). Next it will be non profitable B2B. But then we'll start to see how much of those profitable companies bottom lines comes form non-profitable companies. This will have a cascade effect, since as I mentioned, it won't be as easy for us tech workers to find an new job with anywhere near the same TC. As a 200k+ engineer, consider all the crap you pay for without thinking of it because you don't have to. All the ubers and door dash orders that are surprisingly pricy to the average person, but really a brainless decision for any tech workers. It's just getting started. If you work at a B2B tech company I encourage you to go poke around your internal data and look at how your customers are doing. I promise it's not great. Then look at the state of venture funding [1]. Sure it's still above 2018 levels but it's rapidly falling. The start up scene is going to dry up quickly. There's is more I could dive into but this is a good start. 0. https://www.reuters.com/business/energy/crude-us-emergency-reserve-falls-lowest-since-dec-1984-2022-08-29/ https://www.reuters.com/business/energy/crude-us-emergency-r... 1. https://www.cbinsights.com/research/report/venture-trends-report-q2-2022-preview/?utm_source=CB+Insights+Newsletter&utm_medium=email&utm_campaign=newsletter_general_thurs_2022_07_07&utm_term=spiel&utm_content=research-public https://www.cbinsights.com/research/report/venture-trends-re...
deleted 4y ago
[deleted]
janmo 4y ago
I am ready to buy every piece of hardware, smart phone, laptop, GPU in the minutes after an invasion or a blockade is announced, it will be the single best investment of a lifetime. + with such goods if you are in the EU, you have up to 14 days to send them back and get a full refund, so basically you have 14 days to resell them double the price with no downside risk.
- coolspot 4y ago
  “Minutes after” would be too late. Everything will be sold out and DDoSed hours/days before.
  - janmo 4y ago
    Online it might, but you can still go to a store. Just have to run very fast and hope it happens when the stores are open otherwise it will be too late. ideally you know an insider working there to reserve the products for you.
woevdbz 4y ago
Hence Foxconn building up in Vietnam. I guess if I were a manufacturing company the whole ASEAN region would start to look a lot more attractive. A lot of the China-based mfrs are Taiwan owned and I suspect they are all starting to build for resilience in case of geopolitical trouble.
graycat 4y ago
My understanding is that TSMC is busy building factories in the US. Easy to suspect that this is (1) to keep up production in the event that China takes over Taiwan, (2) to tell China now that even if they do take over Taiwan TSMC production will not stop or be dependent on China but will continue in the US and, thus, lower the interest of China in attacking Taiwan, and (3) once the Chinese military is on the way to Taiwan possibly let TSMC be eager destroy their Taiwan factories on their way out of Taiwan and on the next flight to the US, Belgium, etc., .... Besides, if China does not act nice, they might find that they can't buy any chips to use or copy. The world might regard selling chips to Xi now like selling cordite to Hitler in 1939. The headlines about Taiwan, I'm guessing, basically add up to a lot of desire by the media for eyeballs for ad revenue and a lot of face saving by Xi, that is, don't let the media and politician talk erode the long existing images and status of Taiwan. Net, China has plenty to do now without making a big, real issue about Taiwan. But there is no force guaranteed to keep Xi from making a mistake. E.g., he had China muscle into Hong Kong and violate the "one country, two systems" promise. I'm guessing that if Xi does to Taiwan what he did to Hong Kong, then TSMC will be producing in the US and on their way out of Taiwan will junk their factories so that China gets nothing.

olladecarne 4y ago

Lack of high end tech will be the least of your problems if China and the US get into a hot war.

tshaddox 4y ago
Or at least, it’s not obvious what electronic devices you actually would need if the supply was going to get cut off for ten years.
hotfix12 4y ago
Why would China and the US get into a hot war anyway?
- Spooky23 4y ago
  They aren’t. China needs the US more than the inverse
- kelnos 4y ago
  It's unclear whether the US would deploy its own military to protect Taiwan in case of a Chinese invasion... but it could happen.
kilroy123 4y ago
Right, that's what I was thinking. This would mean catastrophic economic damage. Likely, would be far worse than the great depression. We important so many goods from China.

collsni 4y ago

Thinking the exact same thing. Jumping in on the new Ryzen socket.. gpu is yet to be determined.

crisdux 4y ago

I thought the same thing today after reading this Credit Suisse analysis from Zoltan Pozsar. https://news.ycombinator.com/item?id=32633505 https://news.ycombinator.com/item?id=32633505

alphabetting 4y ago

The supply of TSMC chips won't disappear bc the US will defend Taiwan. It's far too important. The companies with major reliance on mainland China (Apple) are the ones that need to worry.

modeless 4y ago
You really think TSMC will be able to fabricate and export chips at a significant fraction of full capacity during a war with China?
- kman82 4y ago
  Probably yea
  - colinmhayes 4y ago
    A Taiwanese war immediately means a naval blockade, the us won’t be able to lift it with any certainty. There is 0 interest in a hot war with China among Americans. I doubt we’ll see any American military action that could lead to a deployment other than naval.
    - happyopossum 4y ago
      > I doubt we’ll see any American military action that could lead to a deployment other than naval. Err, you other points aside - that's how you'd contest a nail blockade, with an opposing naval force.
      - colinmhayes 4y ago
        Outright sinking more than a couple Chinese naval vessels would lead to a conflict Americans aren’t interested in.
        alphabetting 4y ago
        The US government is more than willing to go to war to keep the world's chip supply out of China's hands. They're also pretty good at ginning up support back home.

colinmhayes 4y ago

The contingency is the chips act building more fabs in the us.

alphabetting 4y ago
CHIPS bill is a decent start but there is no replacing TSMC. A $50B watered down investment into US chips is small potatoes in grand scheme of things. Consider Apple spent $275B building up Chinese manufacturing to gain access to their market.

PheonixPharts 4y ago

My other concern is the collapse of the tech sector in a few months. I'm roughly 80% certain I'll be subject to layoffs in October (though all my coworkers are clueless), and I don't think it will be anywhere close to as certain I can find a new job as during the pandemic (then for every one company doing layoffs there were two with "unprecedented-who-could-see-this-might-end" growth). Lot harder to justify a new PC when no longer receiving a paycheck, though it will likely be even more important to have one then. Just got a new System76 machine and I have to say, I'm really loving it. Hard times ahead, unfortunately after that, it's even harder times.

Zircom 4y ago
Why is the tech sector about to collapse?
- nikanj 4y ago
  Rent, gas & food are soaking up all disposable income, so B2C is toast. B2B is selling to the B2C, so their customers are going away.
- PheonixPharts 4y ago
  There are basically two types of companies in tech: a.) companies that don't make a profit, and b.) companies that make a profit from those companies. As an example just consider every startup is basically in category A, and Amazon's most profitable sector, AWS, in category B. For more than a decade money was more or less free and the only sane choice for investors was to pour cash into anything that might one day get big enough to magically flip the profit switch and make a huge amount of net positive revenue. I thought the pandemic would be the end of the tech boom, but I was wrong. Not only did more money get pumped into the market but into consumers wallets as well. This led to extremely rapid expansion in the tech industry as investors were willing to pump even more cash into any company (hoping for a rapid IPO and a the ability to cash our there chips before the casino closed) and consumers had a surprising amount of extra cash lying around from being locked up for months. Unfortunately reality has started to show it's ugly face. Inflation is starting to hit hard, not because of the money supply, but because we are hitting some real resource limits due to a combination of supply chain problems and the Russian war with Ukraine (which, to be fair, is also happening because of resource strain). These are not temporary causes of inflation. This has caused the central banks to rapidly attempt increase interest to combat this inflation. Ending the era of cheap cash. This is coupled with the fact that things cost more so consumers also can't spend as much (even though they are also taking on more debt then ever, an unsustainable trend). Sure inflation is cooling a bit but that's largely because of a drop in oil prices (at least in the US) which is a political play from the democrats resulting the record low strategic oil reserves in the US (since 1984) [0]. This cheap oil cannot be sustained and will end after the next election cycle. The immediate impact of all of this is that direct to consumer companies are seeing an immediate hit (e.g. streaming service subscribers are churning faster than ever). Then non profitable ad revenue companies start to take the hit (see Snap's layoffs today). Next it will be non profitable B2B. But then we'll start to see how much of those profitable companies bottom lines comes form non-profitable companies. This will have a cascade effect, since as I mentioned, it won't be as easy for us tech workers to find an new job with anywhere near the same TC. As a 200k+ engineer, consider all the crap you pay for without thinking of it because you don't have to. All the ubers and door dash orders that are surprisingly pricy to the average person, but really a brainless decision for any tech workers. It's just getting started. If you work at a B2B tech company I encourage you to go poke around your internal data and look at how your customers are doing. I promise it's not great. Then look at the state of venture funding [1]. Sure it's still above 2018 levels but it's rapidly falling. The start up scene is going to dry up quickly. There's is more I could dive into but this is a good start. 0. https://www.reuters.com/business/energy/crude-us-emergency-reserve-falls-lowest-since-dec-1984-2022-08-29/ https://www.reuters.com/business/energy/crude-us-emergency-r... 1. https://www.cbinsights.com/research/report/venture-trends-report-q2-2022-preview/?utm_source=CB+Insights+Newsletter&utm_medium=email&utm_campaign=newsletter_general_thurs_2022_07_07&utm_term=spiel&utm_content=research-public https://www.cbinsights.com/research/report/venture-trends-re...

deleted 4y ago

[deleted]

janmo 4y ago

I am ready to buy every piece of hardware, smart phone, laptop, GPU in the minutes after an invasion or a blockade is announced, it will be the single best investment of a lifetime. + with such goods if you are in the EU, you have up to 14 days to send them back and get a full refund, so basically you have 14 days to resell them double the price with no downside risk.

coolspot 4y ago
“Minutes after” would be too late. Everything will be sold out and DDoSed hours/days before.
- janmo 4y ago
  Online it might, but you can still go to a store. Just have to run very fast and hope it happens when the stores are open otherwise it will be too late. ideally you know an insider working there to reserve the products for you.

woevdbz 4y ago

Hence Foxconn building up in Vietnam. I guess if I were a manufacturing company the whole ASEAN region would start to look a lot more attractive. A lot of the China-based mfrs are Taiwan owned and I suspect they are all starting to build for resilience in case of geopolitical trouble.

graycat 4y ago

My understanding is that TSMC is busy building factories in the US. Easy to suspect that this is (1) to keep up production in the event that China takes over Taiwan, (2) to tell China now that even if they do take over Taiwan TSMC production will not stop or be dependent on China but will continue in the US and, thus, lower the interest of China in attacking Taiwan, and (3) once the Chinese military is on the way to Taiwan possibly let TSMC be eager destroy their Taiwan factories on their way out of Taiwan and on the next flight to the US, Belgium, etc., .... Besides, if China does not act nice, they might find that they can't buy any chips to use or copy. The world might regard selling chips to Xi now like selling cordite to Hitler in 1939. The headlines about Taiwan, I'm guessing, basically add up to a lot of desire by the media for eyeballs for ad revenue and a lot of face saving by Xi, that is, don't let the media and politician talk erode the long existing images and status of Taiwan. Net, China has plenty to do now without making a big, real issue about Taiwan. But there is no force guaranteed to keep Xi from making a mistake. E.g., he had China muscle into Hong Kong and violate the "one country, two systems" promise. I'm guessing that if Xi does to Taiwan what he did to Hong Kong, then TSMC will be producing in the US and on their way out of Taiwan will junk their factories so that China gets nothing.