4 ms·

I want a more complete picture of why prices are so high from articles like this. Is supply actively constrained, or is this mostly in anticipation of future s

I want a more complete picture of why prices are so high from articles like this. Is supply actively constrained, or is this mostly in anticipation of future shortages? How much of this is a mix of panic buying and price gouging on bad news? I care more about the secondhand market. Prices are nuts for old used gear, but that also tracks with patterns I've been seeing since roughly the pandemic where more and more secondhand sellers on the usual platforms setting pricing patterns are small businesses, not hobbyists.

ambicapter 4mo ago
Memory makers are reluctant to increase fabrication (high cost of capital and boom/bust cycle leads to bankruptcies being common in the industry), and the memory required for AI (HBM) requires more of the production inputs than other types of RAM, thus squeezing regular DDR RAM even more. Long-form article describing this in more detail: https://davidoks.blog/p/ai-is-killing-the-cheap-smartphone https://davidoks.blog/p/ai-is-killing-the-cheap-smartphone
pjc50 4mo ago
Supply is both already constrained and AI companies have pre-purchased enough HBM at enough of a premium that most of the wafers are allocated to them. All the intermediaries are jacking up their prices so their inventory doesn't empty too quickly, because they may not be able to refill it. It is hard to overstate the damage that the infinite money being poured into AI is doing to the wider economy. Anything involved in datacenters is going to experience shortages/price rises. A pre-existing problem is power transformers: https://www.reuters.com/business/energy/us-power-transformer-buyers-scramble-imports-factory-slots--reeii-2026-05-11/ https://www.reuters.com/business/energy/us-power-transformer... The impact on domestic electricity prices in a year just after high oil prices is not going to be popular either.
- simonsarris 4mo ago
  > It is hard to overstate the damage that the infinite money being poured into AI is doing to the wider economy. I get what you're saying but medium term this is an extremely funny sentiment. This money being poured is likely to end up being a huge boon for a lot of economic sectors, including in the US. Most commodity shortages like this end in a glut, with a medium term win for consumers, even if we have 1-2 (more) years of pricing pain. Meanwhile expensive RAM has so far left stock for people that really need it. Calling this kind of demand economic damage is odd.
  - honeycrispy 4mo ago
    > This money being poured is likely to end up being a huge boon for a lot of economic sectors The evidence coming out is saying otherwise.
  - JacobAsmuth 4mo ago
    Yup. Once production ramps up (and then subsequently overshoots) in the next couple years we're going to have GPUs with 96GB VRAM for the price of a 4090 today.
    - coryrc 4mo ago
      They're not ramping up capacity though.
      - KptMarchewa 4mo ago
        CXMT will.
      - pixelpoet 4mo ago
        https://www.techzine.eu/news/devices/141775/sk-hynix-to-double-wafer-capacity-amid-ai-memory-shortage/ https://www.techzine.eu/news/devices/141775/sk-hynix-to-doub...
        deleted 4mo ago
        [deleted]
  - overfeed 4mo ago
    > Most commodity shortages like this end in a glut The 3 RAM manufactures know this too, from painful experience. There won't be a glut this cycle because there are no capacity build-outs. Instead of increasing capacity, some OEMs left the consumer segment to focus on enterprise AI. > Calling this kind of demand economic damage is odd. It's not odd at all because the complementary industries are being damaged - possibly permanently: manufacturers of motherboard, cases, fans, and the entire consumer PC supply chain are being negatively impacted. Expect bankruptcies and consolidation if this lasts for 2 more years.
- Aurornis 4mo ago
  > It is hard to overstate the damage that the infinite money being poured into AI is doing to the wider economy I know it's an unpopular opinion on Hacker News but I think most people are overstating the damage to the economy. Increased demand starts to pull more advancements forward and increase spending on production, which benefits everyone. Transformer demand is real, but what percentage of your electricity bill do you think goes to spending on those transformers? The number is so small that it's a rounding error. Many examples like this where we see headlines about some part going up in price and forget that it's such a negligible piece of our bill that it barely matters. The cost of fuel inputs for base generation and peak supply are a bigger factor.
  - mschuster91 4mo ago
    > I know it's an unpopular opinion on Hacker News but I think most people are overstating the damage to the economy. There are two issues... one being that an economy needs people to buy things to work, and people only can buy things if they have money, and people only have money when they have work - but everyone is laying off people left and right due to "AI". The other issue is that there's trillions of dollars floating around between all the companies. It is likely that a significant chunk of these will fail and give us another 2007.
    - throwaway277432 4mo ago
      We'll be out of work whilst bailing out these companies with printed money and another round of inflation. The middle class will cease to exist. But hey the stock market will show higher numbers so its all good.
      - pjc50 4mo ago
        RAM price and electricity price increases are already inflation.
  - kmeisthax 4mo ago
    The damage is not merely in the increased demand for electricity. Actually, assuming governments get their heads out of the sand about energy poverty, cheap solar, wind, and batteries will fix that. The real problem is all the other crowding-out of investment that having one big megahit technology can do. Let's say you're an alchemist living in ancient China. You discover some kind of strange material made out of melted sand and want to sell some of it as a drinking vessel. One problem: everyone already uses porcelain for that purpose, which holds hot drinks without cracking like your strange sand ones do. So you toss that in the trash and move onto the next attempt at making an elixir of life. Problem is, what you invented was a kind of glass; which has no economic niche in the society you live in. Some funny other places in the far west might invent it, though - hell, they might even figure out that you can grind this material down into lenses and discover an entire field of magic - optics - that you discarded because nobody needed tea cups that crack when you put tea in them. Now, let's say you live in a society that has access to some kind of artificial intelligence. You are going to chuck the AI at absolutely everything, because on average, it tends to be better at all the problems you throw at it. Even simple things like spell-checkers get turned into AI invocations because, well, the Bitter Lesson dictates that having enough compute and learning to throw at the problem will always yield a better result than hard-coded nonsense logic that demos well. And even if you want to, well, you couldn't afford the RAM to run modern vibe-coded slop software anyway. Porcelain crowds out investment in glass, and as a result, we are limited to only having technologies that can be made by or from a pile of stolen books tied together with a bunch of matrix multiplies.
keynha 4mo ago
[flagged]
SlinkyOnStairs 4mo ago
> Is supply actively constrained, or is this mostly in anticipation of future shortages? Both. AI datacenters create immense demand on DRAM, NAND storage, even HDD storage. Then Sam Altman went ahead and "bought" 40% of the world's DRAM production, by way of secretly approaching both Samsung and SK Hynix (each unaware of the other getting a similar deal), which sent the entire market into a panic and everyone rushed to buy ahead of the anticipated supply shortage. The kicker is that it wasn't even a proper purchase agreement. Just a non-binding promise of "By 2030 I will have infinite dollars and buy your DRAM".
JohnTHaller 4mo ago
Supply is constrained. AI bought up so much that we're seeing wafer shortages. Absurd US tariffs messed with stuff. And we're just getting started.

ambicapter 4mo ago

Memory makers are reluctant to increase fabrication (high cost of capital and boom/bust cycle leads to bankruptcies being common in the industry), and the memory required for AI (HBM) requires more of the production inputs than other types of RAM, thus squeezing regular DDR RAM even more. Long-form article describing this in more detail: https://davidoks.blog/p/ai-is-killing-the-cheap-smartphone https://davidoks.blog/p/ai-is-killing-the-cheap-smartphone

pjc50 4mo ago

Supply is both already constrained and AI companies have pre-purchased enough HBM at enough of a premium that most of the wafers are allocated to them. All the intermediaries are jacking up their prices so their inventory doesn't empty too quickly, because they may not be able to refill it. It is hard to overstate the damage that the infinite money being poured into AI is doing to the wider economy. Anything involved in datacenters is going to experience shortages/price rises. A pre-existing problem is power transformers: https://www.reuters.com/business/energy/us-power-transformer-buyers-scramble-imports-factory-slots--reeii-2026-05-11/ https://www.reuters.com/business/energy/us-power-transformer... The impact on domestic electricity prices in a year just after high oil prices is not going to be popular either.

simonsarris 4mo ago
> It is hard to overstate the damage that the infinite money being poured into AI is doing to the wider economy. I get what you're saying but medium term this is an extremely funny sentiment. This money being poured is likely to end up being a huge boon for a lot of economic sectors, including in the US. Most commodity shortages like this end in a glut, with a medium term win for consumers, even if we have 1-2 (more) years of pricing pain. Meanwhile expensive RAM has so far left stock for people that really need it. Calling this kind of demand economic damage is odd.
- honeycrispy 4mo ago
  > This money being poured is likely to end up being a huge boon for a lot of economic sectors The evidence coming out is saying otherwise.
- JacobAsmuth 4mo ago
  Yup. Once production ramps up (and then subsequently overshoots) in the next couple years we're going to have GPUs with 96GB VRAM for the price of a 4090 today.
  - coryrc 4mo ago
    They're not ramping up capacity though.
    - KptMarchewa 4mo ago
      CXMT will.
    - pixelpoet 4mo ago
      https://www.techzine.eu/news/devices/141775/sk-hynix-to-double-wafer-capacity-amid-ai-memory-shortage/ https://www.techzine.eu/news/devices/141775/sk-hynix-to-doub...
      - deleted 4mo ago
        [deleted]
- overfeed 4mo ago
  > Most commodity shortages like this end in a glut The 3 RAM manufactures know this too, from painful experience. There won't be a glut this cycle because there are no capacity build-outs. Instead of increasing capacity, some OEMs left the consumer segment to focus on enterprise AI. > Calling this kind of demand economic damage is odd. It's not odd at all because the complementary industries are being damaged - possibly permanently: manufacturers of motherboard, cases, fans, and the entire consumer PC supply chain are being negatively impacted. Expect bankruptcies and consolidation if this lasts for 2 more years.
Aurornis 4mo ago
> It is hard to overstate the damage that the infinite money being poured into AI is doing to the wider economy I know it's an unpopular opinion on Hacker News but I think most people are overstating the damage to the economy. Increased demand starts to pull more advancements forward and increase spending on production, which benefits everyone. Transformer demand is real, but what percentage of your electricity bill do you think goes to spending on those transformers? The number is so small that it's a rounding error. Many examples like this where we see headlines about some part going up in price and forget that it's such a negligible piece of our bill that it barely matters. The cost of fuel inputs for base generation and peak supply are a bigger factor.
- mschuster91 4mo ago
  > I know it's an unpopular opinion on Hacker News but I think most people are overstating the damage to the economy. There are two issues... one being that an economy needs people to buy things to work, and people only can buy things if they have money, and people only have money when they have work - but everyone is laying off people left and right due to "AI". The other issue is that there's trillions of dollars floating around between all the companies. It is likely that a significant chunk of these will fail and give us another 2007.
  - throwaway277432 4mo ago
    We'll be out of work whilst bailing out these companies with printed money and another round of inflation. The middle class will cease to exist. But hey the stock market will show higher numbers so its all good.
    - pjc50 4mo ago
      RAM price and electricity price increases are already inflation.
- kmeisthax 4mo ago
  The damage is not merely in the increased demand for electricity. Actually, assuming governments get their heads out of the sand about energy poverty, cheap solar, wind, and batteries will fix that. The real problem is all the other crowding-out of investment that having one big megahit technology can do. Let's say you're an alchemist living in ancient China. You discover some kind of strange material made out of melted sand and want to sell some of it as a drinking vessel. One problem: everyone already uses porcelain for that purpose, which holds hot drinks without cracking like your strange sand ones do. So you toss that in the trash and move onto the next attempt at making an elixir of life. Problem is, what you invented was a kind of glass; which has no economic niche in the society you live in. Some funny other places in the far west might invent it, though - hell, they might even figure out that you can grind this material down into lenses and discover an entire field of magic - optics - that you discarded because nobody needed tea cups that crack when you put tea in them. Now, let's say you live in a society that has access to some kind of artificial intelligence. You are going to chuck the AI at absolutely everything, because on average, it tends to be better at all the problems you throw at it. Even simple things like spell-checkers get turned into AI invocations because, well, the Bitter Lesson dictates that having enough compute and learning to throw at the problem will always yield a better result than hard-coded nonsense logic that demos well. And even if you want to, well, you couldn't afford the RAM to run modern vibe-coded slop software anyway. Porcelain crowds out investment in glass, and as a result, we are limited to only having technologies that can be made by or from a pile of stolen books tied together with a bunch of matrix multiplies.

keynha 4mo ago

[flagged]

SlinkyOnStairs 4mo ago

> Is supply actively constrained, or is this mostly in anticipation of future shortages? Both. AI datacenters create immense demand on DRAM, NAND storage, even HDD storage. Then Sam Altman went ahead and "bought" 40% of the world's DRAM production, by way of secretly approaching both Samsung and SK Hynix (each unaware of the other getting a similar deal), which sent the entire market into a panic and everyone rushed to buy ahead of the anticipated supply shortage. The kicker is that it wasn't even a proper purchase agreement. Just a non-binding promise of "By 2030 I will have infinite dollars and buy your DRAM".

JohnTHaller 4mo ago

Supply is constrained. AI bought up so much that we're seeing wafer shortages. Absurd US tariffs messed with stuff. And we're just getting started.