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Could you please expand on this? Aren’t prices sky rocketing precisely because of excess demand? And they’d collapse in turn if demand disappeared. My underst

Could you please expand on this? Aren’t prices sky rocketing precisely because of excess demand? And they’d collapse in turn if demand disappeared. My understanding of economics is entry level so please forgive my ignorance. I’m just curious what you mean.

8ytecoder 4mo ago
The usual argument is that as prices rise, demand will shrink and supply will rise to take advantage of the increased price.
- kube-system 4mo ago
  It all depends on the particular situation as to whether there is elasticity of supply or demand. In this particular situation there is a bit of inelasticity of supply because it takes a long time to spin up a DRAM factory and if people believe it is temporary they won’t make the investment
- esperent 4mo ago
  Yes, it will. It's just delayed because fab buildout takes several years.
anon373839 4mo ago
> Aren’t prices sky rocketing precisely because of excess demand? Not exactly. The RAM crisis was sparked by OpenAI contracting with multiple vendors to take vast quantities of raw, unfinished wafers off the market. Wafers which OpenAI had no use for -- they just wanted to starve competitors. This is different from an "AI is so popular that manufacturers can't keep up with demand" story. OpenAI and Anthropic are the sleaziest companies that have come out of Silicon Valley in a long time, and that's really saying something.
- alt227 4mo ago
  I think you are splitting hairs. Both arguments boil down to 'AI companies are taking all the chips'. It doesnt really matter why, the result and reasons are the same.
  - anon373839 4mo ago
    Sorry, that was a tangent unrelated to the original point. Seeing people chalk this situation up to “high demand” when anticompetitive sabotage was the cause just makes my eye twitch.
  - deleted 4mo ago
    [deleted]
- petre 4mo ago
  It basically Silver Thursday all over again but with RAM. I wish they crash and burn like the Hunt brothers did, Altman goes the way of Sam Bankman-Fried and Micron gets bought by the Chinese. That's what they all deserve.
- andrekandre 4mo ago
  > they just wanted to starve competitors i don't have much to contribute except to say i'm surprised this kind of thing is legal, especially at the scale of what's happening; its extremely damaging to basically everything

8ytecoder 4mo ago

The usual argument is that as prices rise, demand will shrink and supply will rise to take advantage of the increased price.

kube-system 4mo ago
It all depends on the particular situation as to whether there is elasticity of supply or demand. In this particular situation there is a bit of inelasticity of supply because it takes a long time to spin up a DRAM factory and if people believe it is temporary they won’t make the investment
esperent 4mo ago
Yes, it will. It's just delayed because fab buildout takes several years.

anon373839 4mo ago

> Aren’t prices sky rocketing precisely because of excess demand? Not exactly. The RAM crisis was sparked by OpenAI contracting with multiple vendors to take vast quantities of raw, unfinished wafers off the market. Wafers which OpenAI had no use for -- they just wanted to starve competitors. This is different from an "AI is so popular that manufacturers can't keep up with demand" story. OpenAI and Anthropic are the sleaziest companies that have come out of Silicon Valley in a long time, and that's really saying something.

alt227 4mo ago
I think you are splitting hairs. Both arguments boil down to 'AI companies are taking all the chips'. It doesnt really matter why, the result and reasons are the same.
- anon373839 4mo ago
  Sorry, that was a tangent unrelated to the original point. Seeing people chalk this situation up to “high demand” when anticompetitive sabotage was the cause just makes my eye twitch.
- deleted 4mo ago
  [deleted]
petre 4mo ago
It basically Silver Thursday all over again but with RAM. I wish they crash and burn like the Hunt brothers did, Altman goes the way of Sam Bankman-Fried and Micron gets bought by the Chinese. That's what they all deserve.
andrekandre 4mo ago
> they just wanted to starve competitors i don't have much to contribute except to say i'm surprised this kind of thing is legal, especially at the scale of what's happening; its extremely damaging to basically everything