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It goes to nearly zero if China invades Taiwan, and that seems like it has at least a 10% chance of happening in the next year or two.
by rwmj 9mo ago
It goes to nearly zero if China invades Taiwan, and that seems like it has at least a 10% chance of happening in the next year or two.
- fkarg 9mo agoI agree. It's funny that this is one of the cited reason for the (relative) value suppression of tsmc, but the same factors should apply to Nvidia too.
- utopiah 9mo agoBut then again what won't? Non tech stocks?
- throwaway5752 9mo agoGold stocks, basic materials, MSCI world and emerging market indexes. Look at their prices and see how very smart people are positioning their money.
- zitterbewegung 9mo agoIndustrial military complex and government contractors.
- utopiah 9mo agoJets, tanks, drones and data centers for intelligence services, even design, are full of electronics but what's the share of those not made in Taiwan?
- LunaSea 9mo agoDon't they also depend on chips for a lot of components?
- mikkupikku 9mo agoProbably a lot more from TI and Intel than Taiwan.
- utopiah 9mo agoI'd be curious how many of the design and verification (using computer vision) tools used at TI and Intel rely on on farms of stock GPUs thus chips still made in Taiwan. They might have in house chips just for such part of their workflows though, any insight appreciated.
- rwmj 9mo agoYes, lots of other companies would be affected to a greater or lesser extent (even non-tech stocks), but specifically any company that relies on manufacturing all their product in Taiwan will be affected most of all.
- immibis 9mo agoThe whole economy will crash. Probably won't be due to China invading Taiwan though. More likely because the president decided to delete their country's world reserve currency status (which is another word for a trade deficit).
- bpodgursky 9mo agoNVIDIA has been producing Blackwell in Arizona since October. Don't be dramatic. There would be a supply crunch but a lot of dollars will be shuffled VERY fast to ramp up production.
- rwmj 9mo agoThey definitely made at least one wafer in Arizona in October.
- georgeburdell 9mo agoPackaging? Assembling onto boards?
- blackoil 9mo agoCan outsource to China. Only partial /s
- maxglute 9mo agoArizona fabs don't work without TW's many sole source suppliers for fab consumables. They'll likely grind to halt after few months when stock runs out. All the dollar shuffling's not going to replace supply chain that will take (generously) years to build, if ever.
- khalic 9mo agoIdk the pro china side is getting more and more support, at this rate they’ll vote themselves into mainland
- cjbgkagh 9mo agoI think Taiwanese elites can be bought, they say they can’t but I think that’s just part of the bargaining for a higher price. The overtures towards a costly and destructive invasion is Chinas attempt at lowering that price. As is the strategy of building up an indigenous chip manufacturing industry. The aggressive rhetoric from China has the added benefit of keeping the US on a self sabotaging aggressive posture.
- whatevaa 9mo agoWell, the reality is that most people don't want a bloodbath and it's increasingly looking like external support won't come, so what you gonna do... life is a very complex chess game, gotta play your pieces right.
- mikkupikku 9mo agoAt this rate, even if they can't get the Taiwanese population to consent, it probably makes more sense to wait anyway to see how low America can sink. The lower America goes, the better their chance for success.
- Ekaros 9mo agoChina is capable of taking long term view, beyond single election cycle. And currently USA really seems to be heading down faster and faster. If something even more drastic happens. China might even attempt unification with some reasoning like protecting Taiwan from USA or other nations.
- blackoil 9mo agoAn EU type agreement will keep peace for some time. Remove all trade barriers between two countries, have a treaty preventing any side to be used militarily by third party, no attacking each other and free movement of all vessels through each other's seas. Maybe few more
- eagerpace 9mo agoGoing to zero is one potential outcome. Equally plausible is it goes up 10% in a relatively quick battle or diplomatic outcome which ends the geopolitical uncertainty.
- rwmj 9mo agoThere's approximately 0% chance that China will ship leading edge wafers from captured TSMC to the West.
- eagerpace 9mo agoThis is the beauty of Polymarket. Then bet on it. There are so many more outcomes possible to this conflict than what you see reported in the media. Don't be so reductive.
- rbtprograms 9mo ago[flagged]
- eagerpace 9mo agoIm not recommending it, but the subject here (shorting the most valuable company on earth) is pretty degen to begin with.
- u8080 9mo agoShort the stocks then, lol. When people do this kind of predictions, they often driven by emotional reaction. Best thing to switch actual evaluation on certain hypothesis is to make actual risks cost something.
- wordpad 9mo agoNot true, it might be something they compromise on to restore relations
- 9mo ago
- fullshark 9mo agoWhat does the US gov't do in response? Wouldn't they throw globs of money at Intel and Nvidia?
- bob1029 9mo agoThey already have.
- heathrow83829 9mo agobut they're expected to have 8 or 9 aircraft carriers by 2035, doesn't it make sense to wait until then?
- flowerthoughts 9mo agoIf the US is fighting with Europe and South America, China might not that many.
- mr_toad 9mo agoIt’s only about 200km across the straight. They have over a thousand fighters and a couple of hundred bombers capable of crossing that gap.
- toephu2 9mo agoIt doesn't goto nearly zero. TSMC has a large fab in Arizona and they are continuing to expand it. They also have a fab in Washington, and in Japan. [1] [1]https://www.tsmc.com/english/aboutTSMC/TSMC_Fabs https://www.tsmc.com/english/aboutTSMC/TSMC_Fabs
- KK7NIL 9mo agoThe fab in Washington is very old (notice it's still equipped for 8 inch wafers) and so pretty irrelevant to Nvidia's business. I'm not quite sure what process they run there but I believe it was an acquisition 10+ years ago, not built from the ground up by them. Edit: their Japan fab is also a mature node so not very relevant here. And their Arizona fab is a very very small portion of their volume and with far worse margin.
- pinot 9mo agoWA fab is verrry old and makes commodity products, think like small microcontrollers etc. 160-350nm processes.
- alecco 9mo agoI think they are already hedging for Taiwan. 1. They just pseudo-acquired Groq, fully made in USA (GlobalFoundries) and with a diversified supply chain. 2. And they just announced they will be re-introducing RTX 3090 made in Korea (Samsung). 3. And they plan to produce chips in Intel's new US fabs soon. I think the bigger problems of the AI bubble are energy and that it's gaining a terrible reputation for being the excuse for mass layoffs while suffocating the Internet with slop/brainrot content. All while depending on government funding to grow.
- idiotsecant 9mo agoChina invading Taiwan makes zero sense, they just flex those muscles for domestic consumption. They will probably take over Taiwan, but they'll do it how modern major powers do anything: propaganda, influence campaigns, and soft power.
- CamperBob2 9mo agoRussia invading Ukraine also made zero sense, given their actual capabilities and the likely (now realized) consequences. The leader doesn't always have the best information, it turns out. Either that, or the leader does have access to the best information, and they just DGAF. That condition seems to be going around too.
- idiotsecant 9mo agoI guess I see Chinese leadership as more rational than that, but maybe you're right.
- monkaiju 9mo agoUS blows up the fabs on the way out! /s (unless???)
- ropable 9mo agoIf China does invade Taiwan, I feel like most people are going to have bigger problems than the Nvidia stock price.
- fatherwavelet 9mo agoIt seems obvious to me this quickly escalates to a US nuclear first strike with the B2-Spirit on China manufacturing infrastructure. It is economic MAD. Or China can wait 20-30 years and the US will no longer care about Taiwan or have the resources to have much presence in the eastern hemisphere. I think the saber rattling over Taiwan is just to get the US to spend themselves further into oblivion in the short term. We are in the war already and the saber rattling is an incredibly effective, asymmetric financial weapon. It builds up the Chinese military kinetic capacity long term while weakening the US military kinetic capacity long term by forcing the US to prepare for something that is never going to happen. When China takes Taiwan it will be without firing a shot. I would bet the house on that because it kind of has to be that way to win the war and not just a self destructive battle. China is achieving its objectives brilliantly. The US is increasingly isolated and this is the process of retreating into the western hemisphere. NATO is being destroyed without firing a shot.
- ropable 9mo agoFrom my perspective, the US is foot-gunning itself into geopolitical irrelevance through the destruction of its soft power and undermining the NATO alliance. For all its many, many faults, the CCP's actions around establishing itself as the Asian regional superpower are patient, strategic and consistent over the long term. They're playing it far too smart to get into a shooting war with the US, and I'm in agreement that they'll probably end up consolidating Taiwan peacefully in a decade or so.