The explosion of demand that cannot be filled in the most monstrously overstimulated economy and markets ever.
By Wolf Richter for WOLF STREET.
The “semiconductor shortage” is a composite of blistering demand from all sides that got further tripped up by the shutdown of four semiconductor plants.
On the demand side: Since last year, there has been red-hot demand for specialized chips that go into crypto-mining rigs as crypto prices started skyrocketing in March 2020. There was the shift to working-from-home and learning-from-home, triggering from one day to the next an explosion of global demand for laptops, particularly low-end laptops, networking equipment, and other electronic devices, such as printers. There was the broad boom in consumer electronics, particularly smartphones and game consoles on which consumers, stuffed with fiscal and monetary stimulus, spent loads of money. There was the boom in cloud computing and the hardware that it is based on.
Then there was the trend to include ever more chips in consumer products, particularly new vehicles where nearly everything from door locks and rear-view mirrors to engine management systems are controlled by semiconductors. Dashboards have turned into outright computers with screens. The driving assist features that modern cars come with require large amounts of computing power.
This sudden explosion of demand is largely a result of pandemic shifts and the most monstrously overstimulated economy and markets ever.
Shutdowns of semiconductor plants vastly complicated this demand situation. As a result of the Big Freeze in Texas in mid-February, three semiconductor plants in Austin shut down. NXP Semiconductor, one of the major manufacturers of chips used by automakers, shut down two plants there for nearly one month. Samsung’s plant was damaged and didn’t reopen until the end of March.
Amid all this, there was a fire at Renesas Electronics chip plant in Naka, Japan, on March 19. The plant specialized in automotive microcontrollers. On June 25, over three months after the fire, the company announced that production at the plant had fully recovered.
These production shortfalls due to the Big Freeze and the fire – particularly of chips used in the automotive sector – during a period when chip fabs were already way behind, threw the entire sector in deep turmoil. And now there is the backlog to deal with.
It isn’t that chip makers stopped making chips, or slowed down production. On the contrary. Global semiconductor sales, on a three-month moving average basis, jumped by 29% year-over-year to a record $44.5 billion in June, according to the according to the Semiconductor Industry Association.
But wait… this record was up only 6% from the prior record set in October 2018, of $42.1 billion, before the crypto-mining boom collapsed. What has been holding back semiconductor sales this year is the limited capacity to make them even as production is getting ramped up:
Global semiconductor sales collapsed by 32%, starting in October 2018 through April 2019 because cryptocurrencies had collapsed starting in late 2017, with Bitcoin crashing 85%, from $20,000 in December 2017 to $3,200 by December 2018, which caused demand for crypto mining rigs to collapse, which caused demand for their specialized chips to collapse.
But cryptos started skyrocketing in March 2020 through May this year, with Bitcoin going from about $5,000 to $65,000 in 14 months (today it’s at $47,000). This caused the crypto-mining business to soar, and along with it demand for chips.
And then on top of the crypto-boom came the boom in demand for laptops, smartphones, game consoles, home networking equipment, other consumer electronics, servers, other consumer products, such as appliances and exercise equipment that are stuffed with chips….
The historic and sudden spike in retail sales of durable goods entail a similar spike in demand for chips, and chip manufacturers, though now cranking out chips are record levels fell way behind demand, and couldn’t fill the orders for some chips.
The automotive component makers and assembly plants have been hit particularly hard because of the shortage of the semiconductors that go into microcontroller units (MCUs) that combine CPUs, flash memory, and other devices, and are used in large numbers in each vehicle today to control tire pressure gauges, rain sensors and windshield wipers, braking systems, acceleration, steering, ignition, combustion, rear-view mirrors, door locks, etc.
If only one MCU is missing for the vehicle – such as the MCU that goes into the rear-view mirror – the whole assembly plant comes to a halt. To keep the plant operating, the automaker can build the vehicle minus the rear-view mirror. There are now hundreds of thousands of unfinished vehicles parked somewhere around assembly plants, waiting for missing components. When the component gets it, the automaker can then install the component, finish the vehicle, and ship it to the dealer.
But if the missing chip goes into a system that cannot be easily added to the vehicle afterwards, the entire assembly line stops and waits for the chips. This is widespread, with dozens of plants shut down for weeks at a time around the globe.
Consumers and companies with some flexibility can still get a computer or a server or a smartphone. But perhaps not exactly what they had wanted. And they might have to pay more. For example, last week, I got a new server to run WOLFSTREET.com on, with a 16-core CPU and solid-state disk drives, no problem. I took what was available and wasn’t looking for anything in particular, as long as it did the job.
But automakers don’t have that flexibility. They’re building big, costly, and complex machines with very specific requirements that were set many months or years ago.
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me gots lots of semi-stuff
nothing I need for YEARS
of course we can’t have DOUBLE DIGIT DEVALUATION if prices don’t jump 20-50%
how else will $30 T of govt debt be covered
NOT LIKE WE ARE EVER GOING TO PAY THIS DEBT
just gonna keep on DEVALUING almighty fiat $dollar
Wolf write article on your take of upcoming debt ceiling coming once again. And what govt. going to do with medicare projected to run out of money in 2026 now.
Yeah…but can you mine crypto with it?
“I got a new server to run WOLFSTREET.com on, with a 16-core CPU and solid-state disk drives, no problem. I took what was available and wasn’t looking for anything in particular, as long as it did the job.”
exactly – want custom – wait and you might not get
This is when it pays to know somebody in the neighborhood who’s a computer pro and has a ton of new-old junk in his place where it’s just gathering dust. He’ll give you what you want, and probably at a discount, too.
of course 16 -cpu quad processors new-old junk
nice try though
I bought more hardware than I’ve ever bought before in 2021. First a primary server to be used in crypto, then a secondary. Also bought a cage in a data center to house the primary in; still haven’t bought the secondary yet but will soon. Total cost: about $26,500.
And it was the video card that was the most ridiculously priced. $2,000 for a *used* video card with about 18 month old tech. Sheesh.
Supply has been cut to COVID at major factories in Malaysia.
The take away here is widescale globalization has real problems and that is inflationary.
Real estate is king.
Real estate is king until it’s not. There is a limit to what people can pay and many places are reaching those limits. There are hundreds of apts listed in NYC, in good neighborhoods, nobody wants.
I remember living in Detroit in the 1970’s when the Arab oil shocks put the car business on the ropes. I saw streets lined with mansions turn into crack houses. Seriously.
Like you say, Pet, RE is king until its not.
Same thing happened in Texas during the mid-1980’s when the oil price crashed.
I am invested in real estate
The carrying cost of real estate is quite a lot and I am wondering what would happen when and if the mortgage rate goes up
I don’t see mortgage rates going up but if a honest FED comes which is unlikely I see mortgage rates shooting up in line with inflation
I doubt the fed is going to do much with mortgage interests or tapering mbs on an appreciable level. Especially if Brainard takes the reigns from Powell. As much as I dislike Powell, I would be really afraid of the consequences of an activist fed direction that a lot of Congress seems to want to instate.
I see a heavy handed and short sighted “financial revolution” that buries a lot of people. Then again, at this point; most lower and middle class Americans are going to get buried anyways. It will either be the ones who loaded up on debt or the ones who saved. I don’t see any way out of the current situation without burning one group. Given the omnipotence of American materialism and consumerist culture, I’d bet they get bailed out being the majority rather than the probably sub 5% of financially responsible.
In NOLA and surrounding areas many could not evacuate out of the area because they didn’t have enough gas money to leave. I wonder how many were unemployed people kicked off of unemployment early by the democratic governor. These people could have died because they didn’t have gas money to reach safer ground. But I’ll bet that democratic governor is willing to give benefits to refugees.
P,
Are we a victim of cognitive bias?
Gas money would not help, political assumptions do not take you to cause and effect…
As in Katrina, when free bus rides were given to the poor people to get out, many chose NOT…until were forced…
In these situations, the hoods become the Wild, Wild West…
These people don’t leave because they would have nothing when they came back… it would be looted and stolen… repeat after me, there ain’t enough cops to stop this…
Sure, send them gas money, or some Gucci shoes and handbags to trade, it will not make a difference…
They will spend the money at Popeye’s and wait to see what happens…
Petunia, you try to think about poor people from your one perspective…which means you can’t think like poor people do…
Certainly not trying to attack you, merely pointing out fallacies of many, who have good intentions, but based on false assumptions about poor people…
You cannot and will not change the poor… period…
Cowg,
The statement I made about people not leaving because they didn’t have gas money was reported by the local news website, which I read often. It had nothing to do with my views on poverty.
I grew up working class, I was one of the lucky ones. We knew many poor people, widows on social security, kids on welfare, etc. Our couch hosted many jobless relatives for which we were the only lifeline. My parents retired into poverty as well. They lived out their golden years in a housing project in NYC.
P,
I apologize if I offended you, and I certainly can understand your thinking…
However, today really is different…
I’m ashamed to say I have a daughter this very way… all forms of personal and govt assistance, etc… that has all been pissed down a black hole…
Her daughter , my granddaughter, needed braces terribly… wasn’t gonna happen because her mother was too lazy to do it… however, because of her poor status , said granddaughter was on Medicaid and “qualified “ for free braces… $5000 worth… I stepped in to get the child her braces… Her mother refused to sign because she said she read a bad Google review about the Dr who was going to do the work… long story short, I had to pay my daughter $400 so she would let me have signature authorization…
Opportunists all, especially when they get some media attention…
As I said… I KNOW these people…
I do enjoy your comments… thanks…
Cowg,
I would never say the poor don’t know how to exploit the system and the people around them. They do, it’s how they survive. But that doesn’t mean they don’t have real constraints in their lives. The poverty industrial complex in this country exploits more than they help.
Cowg,
P.S.
Please keep helping your granddaughter in any way you can. You may be the only good thing in her life.
The impact on real estate is that monthly payments increase and assets may shrink
what is mortgage??
carrying cost pasted to tenants
I still have a I phone 6 s works great newer isn’t better
I have a 2G Nokia that works great and I still have my privacy.
Until the major carriers ax the 2G and 3G network. That is in process now.
AT&T sent new 4G LTE phone (unrequested) free of charge because my wife was still using 3G sim card even though her phone supported 4G LTE. Went to AT&T store and got her a 4G LTE sim card (for free since AT&T instigated the change).
got notice from cricket that my flip phone won’t be working in near future
not happy
I’ll go to 3G but not 5G
of course I USE PHONE as prescribed – talk and text
3G towers are going to be shut off to free up frequencies for long range cell towers (4G). They can still track your location, no matter what type of phone you use. The government can also potentially hack any phone, to use its microphone and camera against you, if you are worried about that.
5G is simply short and medium range towers. For marketing reasons, some 4G towers will be called 5G. If you are worried about health risks there are none. If you worried about 5G towers being used by CCP to spy on you, there are also 4G towers like that in America.
The newer iPhones are definitely better, to ensure privacy, disable icloud photo upload. IPhones are still vastly superior to Android phones in terms of privacy. This is because the permissions system on Android is broken. The bigger privacy concern with Android is that all the apps you install, could be spying on you as well, iPhones stop them alot more and iPhone apps usually ask for less permissions.
The only company taking actual steps (that is actually shipping phones) to ensure privacy is called Purism. They make a phone called Librem 5. They use a modified version of Android. Far less apps are available in its app store, however most Android apps can be easily sideloaded. They also make privacy focused laptops with Linux.
I have been streaming 1970’s cop shows lately. I love the way McGarrett runs up to his Mercury with the windows already rolled down and the keys in the ignition. He pops in the passenger side door if it is closest and slides across the big bench seat and few seconds later the tires are spitting gravel and he is off. Now between the beeps, chimes, little voices, time for the backup camera to come to life it takes a long time before you are on your way. I think we have been conned that we needed all this stuff powered by chips. Let’s go back to the 70’s when commutes were short, beer was cheap and we could still send a man to the moon and we rolled in big cars spitting gravel with the windows down.
Bookem’ Dano.
Tomorrow heading out for an overnight at my daughters. Using the ’81 Westie, our rolling bedroom and picnic hamper. Mechanical speedometer, add on tach, and a few warning lights. Nary a chip, in fact the dash is so empty I feel comfortable.
For those who believe the future is ever more complexity with rolling computerised EVs, here is one for you. My friend’s wife is an insurance adjuster for ICBC. EV came in with a smacked up quarter panel, (I think it was a N Leaf). The battery case had a small crack from the impact. They wrote off the vehicle as a replacement battery was more expensive than what the car was worth.
Paulo
I too have a Westie, an ’89 with electronic ignition/fuel system controls. But no “on-board diagnostics” (OBD) to tell what is wrong when it fails. Maybe just a few more chips to stop insanity when it breaks down would be helpful.
I’m still looking for a black and white TV that I can hook up to my cable connection. I don’t like the harsh colors of color TVs lately. Hard on the eyes. If you look at black and white TV, and turn on a baseball game its great cure for insomnia. No sleeping pills necessary.
Better yet, turn on a golf tournament and mute the sound on the TV. It’s like magic.
Swamp-(if you don’t have one lying around from back in the day) you’ll need one of the analog-to-digital converter boxes that became available for pre-digital TV’s when the broadcast frequency architecture changed (horizontal lines replaced by pixels-could be an old analog color set would be easier on your vision. Big power-draws b&w or color, though for equivalent digital screen size…).
(admitting i’m probably a minority, a tight baseball game still keeps keeps me riveted considering the infinite possibilities on every pitch of what might happen at the plate and the in/outfield-but that requires a time/mental investment of being a bit of a student of the game, necessary to afficianados of any sport…).
may we all find a better day.
This re BB:
”It’s not over ’til it’s over.” is really applicable mostly to BB at the MLB level,,, for sure.
Most of the others are pretty much over with any decent run up of score, But MLB can score 10 or whatever in the last innings to even or go ahead.
Fave sport as a youngster was the hard core tackle football
( no hard shoes, no hard belt buckles,,, and we all walked whenever any ”adult” came near,,, ya got picked last if no blood at end of game ) ,,, followed closely by ”hardball” baseball we knew how to play with one on one ”work up” and completely OK whenever anyone and everyone else showed up.
NO wusses in either sport in those days, that’s far shore.
You do know you could probably just change the settings on any monitor TV to be black and white?
Seneca-in the same Hollyweird timeframe, helmets (when donned at all) never seemed to require fastening from those vaulting onto motorbikes (not sure they even are, now, but i don’t watch many action-tv/movies these days…) any more than seatbelts in McGarret’s auto. Great ‘why bother’ examples…
may we all find a better day.
Yeah, it’s hilarious to think that it took less computer power to navigate to the moon in 1969 than what is needed for a Tesla to navigate to the next Supercharger.
Space is an empty place.
You just don’t want to be off by a 1/2 degree or so and miss your target.
Also remember the moon’s position moved 150,000 miles during the 3 days it took to travel there. On the other hand, the Supercharger’s location didn’t change.
I have owned MANY cars over 50 years. Many would be valuable today.
Eg: 2 57 Chevs, one 68 Nova, 68 Beetle, 57 MG Magnette, Volvo, Benz, etc., Two could be started with hand cranks, not that I ever did it. I have had many problems, many I handled myself back then.
Moving into the modern cars, I have no desire for power windows, mirrors. door locks, Blue Bag, I mean Tooth, etc. I’ve had all those screw up. I have had probs with carbs and or course distributor points.
I have NEVER had a problem with fuel injection or e-ignition.
You may notice faded ‘tune up’ signs. Back in the days of points, (a switch that went on and off thousands of times a minute) ANY car would
start to lose its best after 10-20K miles until finally running rough, as the points of the switch corroded. This issue is so completely solved by e-ignition there is really no such thing as a ‘tune up’ except as a scam.
I have also NEVER added fuel injector cleaner.
Anyone who wants to scrap FI and E-ignition should scrap his computer and get an abacus.
Seneca’s Cliff,
I like having the technology in my bike, motorbike and car.
My 2010 carbon fibre Wilier bike with a Campy Super Record groupset works well, and it was state-of-the-art in its day, but compared to my 2020 Bianchi with a SRAM RED eTap groupset, it’s an old machine. Now, the front and rear derailleurs have chips in them as they are battery powered and wireless. But the thing is, the Bluetooth radio controlled works better than the old style derailleurs with mechanically activated cables.
The same is true with my motorbike’s computer controlled ABS, traction control and wheelie control. My old sport bike has none of these, and while it is a fast machine that works well, my new motorbike is faster, safer and much more fun to drive.
And my car lets me use, or turn off, the “Dynamic Stability Control.” Yeah, It’s a kick to turn it off and step on the gas coming out of a cloverleaf and slide the rear end a bit, but it’s better to leave it on and have the computer control everything so you can be (if you want to be) at the limit of grip and acceleration with virtually no tire slip when coming out of a cloverleaf. I always drive my M4 with the DSC engaged.
I used to prefer vehicles that were simple and old-school, but for performance and safety when driving and riding, new-school with semiconductor chips and computers is much better and enjoyable to use.
Dan, aside from the cockpit storage compartment doors and the front hood release, every control on my 2020 Z4 operates thru a layer of electronics. Wonderful car, but it often makes me feel like I’m just playing a rolling video game.
I remember when I perfected the, “burn-off wheelie,” after I put a high comp 1100 kit, with 3/4 cams in my “77 Suz GS 1000. I matched the power with a set of small aircraft brakes on the front. After which I could both pull up the front end about two feet, then properly snatch the throttle to break the rear end loose as I brought it all the way up, or all the way up to speed.
The front brakes allowed precision stops with the rear end in the air, properly called a, “toe stand.” Fun stuff. This was my cheapest route to a massive power to weight ratio that few vechicles could, or would match. That was the point of it…
The accessories you describe sound like something a judge would sentence me to. Anyone who actually needs them likely does not have the requisite skills to operate the machinery in the first place, independent of the point of use, be it cruising or racing. Life always pulls off, or punches through the training wheels, eventually, and you better have the skills necessary to deal with it when it happens, involuntairly, or by choice. I like choices…
After surviving decades on two wheels it sounds like your choices are well-tailored for your purposes, but beware all the various forms of, “hardware induced weakness!” The modern world’s training wheels can take the edge off your reactions and power potential if you let it.
Agree aw, especially with the last concept:
One of my all time fave birds loved to ride the bumps in the hills behind me on my scooter, and we frequently went totally free flight and landed together,,, then did other equally fun stuff with the ”juice” produced…
Bunch of young boomer wusses on here, far shore!!! LOL
I had a 1979 GS1000. I still have two 1980 Yamaha XS1100s. Amazing power for such old bikes.
Alex-gotta love them stone-axe roller-crank GS’ & Kaw Z9/1k’s (still happily riding my 850/1000G’s and ’77 Zed, 150K+mi on all of them…).
may we all find a better day.
Relax Wolf, the auto industry will be fine, especially the US companies, they are rolling out dozens of EV models through the next decade. (marketing speak for don’t look at the fact that we can’t get vehicles out to the dealers, just focus on the bring green future)
As for the short fall, you said it yourself on the podcast, the automakers are now selectively firing customers… excuse me, prioritizing high value customers (i.e. the retail suckers who will pay anything for a set of wheels) and ignoring the rental car companies. I wonder if this makes the rental car company start to look elsewhere to vehicles in addition to not selling their existing fleet. And when there are fewer used cars on the market, the auto makers win again… cause the retail guys are going to have to buy new cars with higher sticker price.
This is like the virtuous cycle for the airline industry, when they discovered that if they reduced the number of flights, they could in turn stuff more people into the same plane, and on top of it, charge them all sorts of fees. Costs go down, revenues go up, what’s not to like. The car companies might be able to do the same for a while, lower revenue, but higher gross profit, lower costs (due to fewer active production lines), and on top of that, a captive audience. A triple win if there is ever such a thing. (yeah,
Sure, it might be transitory, but fortunately, corporate America is wise enough to never look past the next couple of quarters.
:P
Are the automakers going to rebrand these stored models for the current models years?
Or will they retain current model year status and incentivized?
Sure, why not, the B version of the 2021 model. Heh heh.
2021 update B; make it sound like a OTA software upgrade like how tesla is doing it so that you feel like the car is up to 21st century standard.
The car rental places will just use more foreign cars. They will likely be more selective in picking car models and will try to keep them running longer.
It’s also possible that the car rental places will follow suite and try to mainly lure richer customers to rent only, top of the line cars.
I am a firm believer that difficult times are a great opportunity for some introspection to understand what went wrong and to learn and improve from it. When it comes to automobiles, these things have WAY TOO MANY computer systems, and now they’re getting burned because of it. They need to dial those way back.
And all of these “crypto mining rigs” – can you say environmental waste? What in the world is going on when nobody is talking about the horrific energy and natural resource waste, all in the name of a valueless speculative orgy of greed, at the expense of legitimate companies and people who need the chips for worthwhile production. How disgusting.
With regards your 2nd point.
Las Vegas.
Agreed on both … when it comes to cars I wish they would make the equivalent of an 1988 Honda Accord but with modern techniques. It would have 150hp, 60mpg and just a spot to hold your iPhone or a screen to mirror it (all cars should just have this) … and it would cost $12,000 and run for 400,000 miles with no issues. Of course they will not do this for obvious reasons. I hope China does it with electric cars soon and I think it could as car prices fall like flat screen tv’s with 500hp being easy.
The second part about crypto has me furious. Blockchain is very interesting and I think it will revolutionize some things but the idea of the “currencies” being worth so much is stupid and the fact that in this time of us needing to cut energy use we are using up a large country’s worth to “mine” this completely unnecessary thing is criminal!
I saw recently that China is now making an all electric commuter car. Price: $5000 totally pimped out. I don’t expect to see one in the states anytime soon.
Golf cart.
Yeah, but I think eventually they are going to be able to make cars that compete with your average $40,000 Honda Accord for about $15,000 … only they will have 500hp because it’s easy. Car prices have gotten so out of control and people don’t really care about all the extras that make them cost so much. Some are nice, sure, but mainly they added all that stuff to be able to charge more and so much of it is electronics that doesn’t have to cost a lot. China will eventually put the pricing pressure there like with everything else.
The cheap China cars don’t last very long at all. It’s normal for them to be not worth repairing in under 5 years. Most Chinese cars are actually banned from being registered in the better Chinese cities, those cities push you towards the “joint venture” cars. They also aren’t safe and aren’t very good in general. Only the “joint venture” cars are worth using in China, but are then, no longer cheap. You should never assume a Chinese car will be repairable.
As for American modern cars, them being hard to upgrade has little to do with the tech features and is just a part of a campaign by corporations to prevent you from repairing anything, unless they get a ton of money from you.
It wouldn’t be hard to have an interchangeable standard for the radio screen that connects to the car speakers and backup camera. That will give you nearly all the modern tech features without anything complicated. It can easily have the carplay, Bluetooth phone features (microphone built into tablet) and everything else, easily, all in basically a tablet. It would be far easier than you could imagine to do this.
The side blind spot detectors are often self contained in side mirrors and could also be easily interchangeable.
All modern cars should have stability control and the like (it’s been required for 10 years). That would be a simple computer that shows by speedometer, this could also be made interchangeable, in that the car makers would agree to a set standard for the internal car control systems and use set computer boards and the automakers would have to distribute the firmware to registered companies. This also controls the remote start and temperature controls. This is also far easier to do than you think.
Almost none of the smart car features are anything complicated. They are difficult to repair, to force you to use their official dealerships and parts for repairs (and planned obsolescence). Self driving cars, would be more complicated though.
What happens when a Nola vent floods all the cars
The chips made for automobiles are low technology. No one would ever consider using a high-end fab to make a low-end chip. Automobile chips barely break even when fabricated on fully deprecated 20-year-old equipment. The fabs are old, and there’s limited supply of raw materials, consumables and replacement parts for ancient Varian or Perkin-Elmer equipment.
GM used Motorola 68000 processor in an ECM until at least 2005 (not sure which makes/models). That processor was introduced in 1979. 1 MB memory. They then went to a Motorola 40 MHz PowerPC chip, 2 MB. Wish I knew which processors were used in all their vehicles, kind of fascinating that these old chips were used for so long when they were so so “obsolete” in personal computing. WAY before my time but interesting…
In the 1990s, Motorola fabricated their automobile chips on 100mm and 125mm wafers. This was at the time when the industry was transitioning from 150mm to 200mm wafers. During that time, Motorola forced deep price decreases on its suppliers. In the end, some suppliers simply walked away from the business.
There a f’ing chip in the led flashlight my wife got me for Christmas in 2017. It controls on and off and it has a low and high and get this, a SOS repeating mode. Trouble is you got to go through all the modes before turning it off. At times the thing will just go off on its own or not turn on and it EATS AAA batteries. I was night fishing for Walleye on Fontana lake in the Great Smoky Mountains and it started that shit. A few days after I got home I hooked it up to my O-Scope to see what was happening. The chips primary function is a DC to DC oscillating switcher which regulates the current going to the Led. The on and off , low, high and SOS bull shit is along for the ride as different oscillating modes and pulse widths. It will reset to off in any power cycling from the batteries. Sometimes you have to take out a battery for a “hard reset” to make it work. The Led will burn out if you bypass the chip. The chip drops out and leaves at least 35% of the capacity of the battery un-used. It’s a bright as hell over designed and still misses the mark piece of shit …..when it works. When it’s 2am and you need a night crawler on your hook the last thing you need is a F’ing App.
Wow
Thank you for sharing.
Over Engineered Anonymous
In the ironic “typo” department, a “Review” mirror is a fitting term, since you are “reviewing” traffic behind you !!
Leave it in Wolf !! :-)
CNBC’s “Next Gen Investor survey” bemoans the fact that “Cryptocurrency investing has a big gender problem.”
The survey indicates that twice as many men as women invest in cryptocurrencies. Also, cryptocurrencies “have been promoted as a way to democratize a traditionally walled-off finance field and increase investor diversity.”
So, isn’t this a horrendous gender discrimination issue? ¯\_(ツ)_/¯
It’s almost akin to when females felt uncomfortable, and negative stigma when smoking cigarettes in public. Now that the smoking percentages are way up for females, the equality of things feels more satisfying.
Furthermore, although people of all races are about equally likely to own cryptocurrency (11% of whites, 11% of Blacks, 10% of Hispanics, 14% of Asians, and 13% of “other”) … only 4% are Black women. “This lack of diversity among cryptocurrency investors means whole swaths of the public are missing the opportunity, and repeating the same story of the investment industry going back to the very start.”
So it seems like reparations should be considered. Maybe Black women should get a percentage of the average crypto investor profit when crypto becomes an accepted mainstream currency.
They are over-represented on uuu Tube ads on my smart TV however. I have ad-blockers on my computer so I don’t see ads. I’d say uuuuuuuu Tube ads are about 95% P O C.
But the way things have been going in financial land, it won’t be the profits that will be redistributed, but the losses.
In other words, nothing but the usual happenings, losses are made up for by the taxpayers. 13 yeas after the financial crisis, fundamentally, nothing has changed, or rather, things have changed, but in the other direction.
I’m amazed it’s only double. There have been all kinds of data about women being better at not ‘churning’ their stocks and being more careful about new schemes. Of course in the Robin Hood era where AMC is up 1000 % while losing hundreds of millions on empty theaters. the young bucks look smarter. We’ll see.
“The survey indicates that twice as many men as women invest in cryptocurrencies.”
This is one of those many instances where women are clearly smarter.
Heh, you know the funny thing is that with crypto, unlike other asset classes, redistribution is actually possible. Just find those crypto billionaires, beat them until they give up their private keys, and give it out to the worthy… ha ha ha ha.
One bitcoin at a time. Although given the lack of actual financial education, it is likely those who get wealth redistributed to them will likely lose it in no time flat. Life is just wonderful that way.
Too bad it’s so darn difficult to teach people to fish rather than just handing the fishes out.
Printing trillions of dollars out of thin air will make prices go up, especially when capacity within an industry cannot be quickly and easily expanded. Given we are about to print a lot more, expect more of the same. At least expansion is cheap for borrowing, but it will take time to come on line. Economic uncertainty does not help.
> last week, I got a new server to run WOLFSTREET.com on
Wow you self-host?
Bravo for not feeding the CloudPonzi monster.
The server sits in a data center, and I have to pay for that, but it also comes with much better infrastructure than my home, and it comes with some services too.
While I can understand the ‘chip shortage ‘ and the reason for it, the “National Coin Shortage” is a complete mystery to me. Well, aside from the conspiracy theory rationale. In my neck of the woods we have businesses with signs saying National coins shortage-asking for exact change at local grocery stores. Is it like this everywhere? Maybe Wolf can shed some light?
This was a big and well-documented issue during the lockdowns last year when people stopped using coin-operated vending machines and laundromats. Another contributor might have a further switch to non-cash payments. And coins stopped circulating. The Fed even wrote about the coin shortage. But it seems by now this issue should have gone away.
And yet the Twin Cities’ local ABC affiliate has this:
“Coin shortage affects State Fair vendor pricing.”
“State Fair vendors have rounded off their prices to account for the national coin shortage.
“We had to got with no coins at all because I was told it was impossible to get quarters. I even called the Federal Reserve to see if I could buy them directly from the Fed and I couldn’t.” said Carol Helmer, of the Fried Fruit & Fried Olives stand.”
Yes, if you want some deep fried olives at the Minnesota State Fair, they might cost a few cents more. And yes, we’re blaming the Fed.
“We had to go … – not got
That rounding up or down is called ‘Swedish Rounding’
When something’s needed, but not available, it’s priceless. Funny that quarters are now priceless in some places.
More coins would be in circulation if the banks didn’t charge people 10% or more for the privilege of converting valuable, tangible-metal coins into their increasingly worthless paper money.
Then again, with a few more years of inflation, soon even a dollar won’t buy much of anything, and then all the coins will be collectibles rather than currency.
Note that they still refuse to print any bills larger than $100. Users of paper money are being treated like those who prefer not to take experimental vaccines… It’s so funny to see people who espouse “diversity, equity and inclusion” working so hard to eliminate diversity of opinion and exclude those who don’t conform to their mandates…
Do you guys still have the penny? God are we happy we got rid of it. The Mint fought like hell, because it was a make work scheme for them. The damn things didn’t circulate, they accumulated in jars, but still managed to slow down every cash till by 5%/ Many cashiers had a jar with ‘take a penny leave a penny’
Not McDonalds. Near the end I ordered and it came to 7.01, I look around for floor change: no luck. So I hand him ten bucks. Problem: now he needs 4 one- cent coins and he has to go get a roll, break it, etc.
When I got home I figured very roughly, it cost McD 15 cents to collect their cent.
Warning: when inevitably it comes time to retire a coin that costs more than a cent to make (even out of zinc) and won’t buy penny candy and wastes everyone’s time, you will undoubtedly have a bunch of conspiracy theorists alleging X or Y.
We had them here too but the cash registers auto- round to nearest nickel. It’s history. There was a big scream when postal codes (Zip codes) came in too. No one can remember what it was about,
I’d say you are moving in the wrong direction, which is very suitable to the people who wish to ultimately destroy the protections afforded by a coin and currency money system…i.e. the right to object by witholding. Far more important to restore the public respect for the value of money earned an in-hand. Redemption of old money for new at a rate set somewhere between 25:1 & 100:1 is long overdue. For instance, a single piece of stainless steel flatware in a large thrift chain is now set at near 50 cents (3 for 17 cents back in ’95). If redemption were set at 25:1, two nu-cents would buy a perfectly good piece of steel wares that has a lot of life still in it. Those buying new at the top of the economy have no respect for hard earned money and are dragging the rest of the public into this black hole of debt financing of all that they use. Restore the respect at the level of labor, and the ones at the level of capital won’t be able to pull so many levers while hiding behind their banker’s curtains. How much does it cost to maintain all those electronic place holders for a whole string of extra zeros? BTW..I have seen postcards from around 1900 that were delivered with nothing but a name and town. Even with the zip system, the current mail carriers are still dropping everyone’s stuff in the wrong boxes. Nothing is infallible when humans or machines are involved, and a bigger set of numbers does not guarantee a faultless result.
Relief on the chip front might come from a change in bitcoin mining. Right now it’s based on PoW – proof of work. PoS, or Proof of Stake, is far less computational and energy consuming.
Ethereum is pushing hard for PoS. Given the added features of ETH such as smart contracts, it could crush BTC and its energy-sucking oligarchic miners.
Alas, like all things crypto POS will be complicated by competing variations of algorithmic confirmations and the usual abuses. However, the cost of mining will fall dramatically. Traditional miners will not be needed.
So once they move to PoS sell your Nvidia and AMD stock since many miners run rigs with multiple GPUs.
Then you can have your new Sony PS5 and you can get a video card for your PC for less than $400.
Crypto mining is a drain on the electric grid. In June crypto mining was banned in China as it is a nuisance.
How many homes destroyed or damaged by Ida? After Katrina flooded New Orleans, many residents left town. Got any vacant homes to spare? 110,000 Afghans arriving with the clothes on their back.
This U.S. already has 330 million people.
Add 110,000 more…a real drop in the bucket.
People complaining about an influx of Afganis are innumerate.
110,000 Afghanis, 150,000 Haitians, 200,000 Salvadorians, 16,000 Syrians, not to mention the millions of Mexicans, Chinese, and Filipinos admitted under the family reunification regime, and sooner or later you’re talking about a lot of people.
But they tend to vote Democrat at least 80/20, which is why the Democrats love them.
RNY
My grandparents were immigrants.
So you suggest that NOW we pull up the ladder and bar the door ?
OutsideTheBox
Yep, bring them all in and all their extended families, but
Doooooooooooooooooooooooooon’t put them anywhere near me nor anywhere near where I live.
I never realized that “Swamp Creature” was a Native American name.
“So you suggest that NOW we pull up the ladder and bar the door?”
This is the kind of myopic, braindead thinking which is so dangerous. It suggests that the US can import an unlimited amount of people without a crushing financial and social burden which will lead to the complete collapse of the country. People who think like this have no financial acumen whatsoever, and also lack critical thinking skills.
DC
Nice rant but as usual, fact free.
Population of the USA over 330 million with an influx of 110,000 is what ? Less than a third of one percent.
Kind of the same percentage you have claimed die from COVID which you have claimed is over blown.
The sky is falling.
As I stated earlier, the 110,000 number is very dishonest.
Let’s talk about the 60 million people who have immigrated since the system was overhauled in 1965.
RNY
So you claim 60 million have emigrated to the USA in the past 56 years ?
Immigration of a tad over one million a year ?
So why is this a problem?
Immigration… at least the legal version of it, is not a problem. Because the US is not that easy a country to get into. Legally that is. The number of green cards is somewhere just north of a million a year. In a country of 300M, that’s not exactly a lot. The process for approval is tremendously long in many instances.
In fact, one can easily say that the legal US immigration system does need to be fixed to compensate for lack of labor in certain areas.
Of course, the problem is now, our wonderful government is incentivizing people to not work, so, the labor shortage becomes more acute, and suddenly there is more need for labor and hence immigration.
Too bad so many US citizens are a bunch of lazy asses living off the government. Wonder if we can exchange some of those lazy a**holes for some of the immigrants who are coming in. One thing for certain, those immigrants would want the opportunity to work, even if it’s menial jobs, because they have a belief that there is an opportunity in this country to advance.
You know, a system where as a citizen in between certain age range, if you haven’t worked enough, Your citizenship status gets revoked, and you lose government benefits. If one were to borrow a phrase from Michael Ironside in Starship Trooper and mangle it a bit: Everybody works. If you don’t work or aren’t pulling your weight, You are invited to leave.. the country! Free ticket to a -Stan….
So first you say that 110,000 is miniscule, and now when I say it’s been over 1 million per year on average, for the past 60 years, you say that that is not a lot (leaving aside the fact that this doesn’t include all illegal aliens).
That’s the reason why our cities are packed, our infrastructure is beyond capacity, and we don’t have enough good jobs for everyone.
Just how many more destitute (and often, culturally unassimilable) people is America obligated to take in? Open borders fanatics are mentally ill.
Someone I know just got the graphics card he has been on a waiting list to buy since November 2020. Almost a whole year to buy a high end overpriced graphics card. The good news is he can sell his old one easily.
The chip shortage is not going away for a while because almost everything will have a chip in it in the future. Luxury products are now being chipped. And smart clothing is a thing too.
I love POS. Good name for a coin.
Two very large chip manufacturing facilities being built in Phoenix area…
Those are the clone plants to the D1x mod3 plant in Oregon which started construction 4 years ago. Intel builds the first fab for its latest chip in Hillsboro and hones the process there,then replicates it exactly in Arizona, Israel and sometimes Ireland. The mod3 plant is designed to manufacture Intel’s 7nm chips. The building has been under construction for 4 years and just this month they started bringing in the “tools”, which is how they refer to the chip making equipment. The process of getting those running and getting the bugs out of the process could take up to 2 more years. Then they will start the process of replicating it in the buildings they are constructing in Phoenix ( if the water supply doesn’t dry up first). So don’t count on those new fabs in Arizona solving the semiconductor problem anytime soon.
By the time all of these facilities are up and running, there will be a massive glut of chips and they won’t even be needed.
Biggest is and probably will be TSCM. Just announced a big reduction in size of wafer= greater info density with 17 billion investment.
Chandler area is going to be very busy going forward. Intel is expanding, and TSMC is going to put down some roots there.
The question is whether there will be a comparable ecosystem that builds up around it
I remember when Samsung came to Austin in the mid 90s. it was a pretty big deal then.
Not to be too picky, but employment is still 5.7 million under February 2020, and that was hardly full employment. There is still massive poverty in the US, especially in urban areas. And what are we going to do with all that money NOT being spent to enrich the neo-cons? How about we invest in ourselves? Instead of war.
“There is still massive poverty in the US, especially in urban areas.”
Absolutely. And what has the current administration done to address the millions of homeless living on the asphalt? They’ve chosen to import hundreds of thousands of Afghani and Salvadoran refugees, and put them up for free while sticking a salty finger in the eye of the truly needy Americans. These people are sick in the head.
They’re future Democrat voters.
You should see the refugee centers that “religious” organizations operate. I would so love to name the religion of the one in my region but it’d give my location away. Forei gners coming and going in brand-new cars all day long. All signing up for taxpayer-paid bennies at that office. The “religious” organizations are paid for by you and me, NOT the congregants!
DC
If you mean by truly needy, the bunch of able bodied a**holes sitting around gathering unemployment checks while trading stonks and playing video games while not paying rent. I’d like to have a system for offboarding those people, and letting the refugees from El Salvador, Afghanistan and so forth work.
Cause you know what, I’ll bet those people who have suffered hardships and seen hard times, or know what a screwed up country they come from are more than willing to do hard work to support themselves. The ones who are born here with an entitled attitude, I’d just soon have them live over in any “third world” country and let them figure out how good they have it here.
It was the good times and bad times.
We had high GDP but lesser jobs,
Higher insurance rates but lesser healthcare,
bigger government but lesser administration,
more media but less truth,
more earnings but no morals…
It was 2021.
“It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of light, it was the season of darkness, it was the spring of hope, it was the winter of despair.” ― Charles Dickens, A Tale of Two Cities
Some possibly good news: this morning (after my first pass through these comments) a family member told me a friend of his is working on a Ford project to develop a family of modular “dashboards” for Ford trucks that range from “dead simple” to “all the bells an whistles”. This system will allow customers to choose from the options and then selected dashboard option will then be installed by the dealer. Perhaps this is the beginning of some rationality in vehicle electronics…
I have been waiting for this actually. I think that because electric cars will be cheaper and more reliable the car companies will start to make modular parts so that you can easily just upgrade or customize lots of things. I mean soon power will not be a consideration and cars as fast as Porsche Turbo’s will be just “regular” so if you have a chassis that runs for 1M miles it would make sense to be able to customize things and that way they can get people to buy news stuff when the prices of cars plummets. Who knows but I hope it goes this way.
@BH
1hp = 746watts (without losses in conversion to/from batts)
500hp =373Kw for 15mins is 93Kwh. say 25mls @ 100mph.
Av household supply UK = 3.2Kw ie 4.2hp
29hrs to charge with no losses. What’s left for the rest of your journey??
Boost charger 6Kw ie 15.5hrs to charge but never forget the losses.
Multiply by 100m when everybody has one.
Let’s not let a crisis pass without taking advantage.
Wall Street Journal 8-26-2021
“Taiwan Semiconductor Manufacturing Co. plans to increase the prices of its most advanced chips by roughly 10%, while less advanced chips used by customers like auto makers will cost about 20% more, these people said. The higher prices will generally take effect late this year or next year, the people said.
Apple Inc. is one of TSMC’s largest customers and its iPhones use advanced microprocessors made in TSMC foundries. It couldn’t be determined how much more Apple would pay.”
Personally, I see this as NOT transitory (unless you want to define transitory in decades) inflation.
Price is the magic when it comes to fixing supply shortages, it will just take a little while. Money makes stuff happen.
It’d be really interesting to see more data on chips (and other economic outputs) in terms of unit sales rather than dollar sales.
A manufacturer with a near-monopoly in an area of inelastic demand could, say, lose 1/3 of their production due to an “unexpected issue”, double prices to balance supply and demand, and still proclaim “record sales”… but the world would still have 1/3 less product available. And if the capital cost to start up fresh competition was large enough, that problem could persist for years.
Add: and not just sales, but unit deliveries. (Cem’s comment below is apropos.)
Oh, the chip increases especially in 14/28nm will be transitory because when China becomes self-sufficient in those nodes next year, there’s gonna be a yuuge overcapacity.
Just responding to the title, I work at a company that relies heavily on manufactures having stock and customers wanting to buy it.
Long story short the chip shortage isn’t going anywhere and the reason sales look so good is customers scrambling to get their order in now so when stock returns they’re first in line.
Think like 100% bookings growth YoY.
I placed an order from Digikey a few days ago, and
one part went out of stock between the time I put it
in it my “shopping cart” and went to order. Another
went out of stock while I was actually placing the
order. One of those had almost 70,000 in stock. I
can’t feel too bad, though, because looking back, I
think I’ve cleared the market of five different
components the over the last couple of decades.
We currently have an issue with no stock and very
long lead times for some microcontrollers. Ordering
a bunch to stockpile for future production does make
a lot of sense.
I had the same experience on DigiKey last month, parts evaporating between filling cart and placing order. Then Mouser had a 50 piece MAX order quantity. Some parts now showing next ship date of 7/2022.
Are these chip makers seqwaying into higher value items as well? Just get the notion that SINO is throwing their weight around in Asia, (and blaming the virus for the slowdown.) They’re not buying our AG either. 1/4 of SINOs GDP is housing and they want to spark consumer spending, (but they have no Xmas, sigh) They have a wealth disparity problem :)
damned algos, I feel like a container ship at the Port of LA.
I guess, part of that shortage is hoarding. We have seen that in the toiletpaper-crises 2020.
I don’t recall if I read it here (great stuff Wolf) or not, but the issue with cars is that they rely on older chip technology based mainly on 200mm wafers. These fabs aren’t being built as everyone is all-in on the newer stuff using much bigger wafers. When the car makers cut back, they got pushed to the back of the line when things started to ramp up again. Crypto uses state-of-art technology as it draws less power and has much more bang for the buck per square cm.
All this talk about crypto, and yet no one has mentioned Tether even once. Uses less power than Bitcoin and Ethereum, heck it uses less power than all crypto coins combined. Very very environmentally friendly. It’s also a ponzi scheme, but who cares at this point right?
I was gonna take you to task on Tether but you beat me to the punch with your last sentence. Transparent as Wells Fargo and twice as trustworthy.
I admire your research energy.
Couple of minor points in passing.
Nvidia as a co specialised in graphics chips which became lightning fast because of demand from high end gamers. Their cards were usually an expensive add on in the early days but gradually they became more mainstream.
For bitcoin speed and energy are critical so the miners soon discovered they could use graphics chips for their rigs. This got the gamers up in arms for a while but Nvidia went on from strength to strength to be a US superstar holding its own against all comers. They are currently trying to takeover Arm one of UK’s last chip players.
I think cryptos will eventually run out of chip capacity in the long run.
TSMC is talking of a £100bn investment programme to justify its proposed price increases, who can compete with that on top of what they are already?
Cryptos will not be the reason for existence for companies like Nvidia. In the long run, the processing power of graphics card is going to be needed for a whole lot of automation that will need to come out.
As for gamers, they better watch out. China is enacting a new ban on gaming… what if it catches on in the US….
Ha ha ha ha, I kill me.
I think the major miners use custom-built ASICs, not NVIDIA or AMD cards. GPUs are only used by the hoi polloi for mining. I’ve also read that GPUs for crypto mining make up a small percentage of sales by NVIDIA and AMD, but despite this the hype has had a big impact on stock price.
Not quite. ASIC is good for mining one type of coin. GPUs are more flexible. Depends on your goals.
For instance, Wolf just got an Antiminer S9, not just some cheapo computer for his bedroom closet “office” like he claims. I tried to warn him about how it’s limited to BTC but he can be stubborn and you know how much he loves BTC. He also burns his own coal to power it. Yep, right in the heart of the People’s Republic of California.
For the uninitiated, everything after the first paragraph is an absolute lie. I have to say that or he wont let me write medical articles for Wolfstreet. Ok, that’s also a lie.
Everything I say is false, including this sentence.
With all the money (investment) in crypto there is no reason they can’t fund and make their own chips. The people want crypto, its a democratic revolution fired up with the money the old regime was printing to make “themselves” rich, sweet irony, every bond Powell buys fuels the fiat systems destruction.
You can’t just wave a wand and create a fab. New fabs take years to build.
And as I said before, if PoS prevails the need for chips drops.
“TSMC is talking of a £100bn investment programme to justify its proposed price increases, who can compete with that on top of what they are already?”
Companies like Intel who brag about their big investments in chip manufacturing while not mentioning their government funding? I’m just guessing here.
H/t to Wolf for the inside scoop.
Disclosure: I own shares of TSMC and LCRX.
There are brokers out there who have parts in storage and are willing to sell them for a premium. Semiconductors are a big speculation item at this time.
At the same time there is o shortage on wavers on the market. China decided to stop exporting wavers to keep their own production going.
A couple of states have Covid restrictions and decided that Semiconductors are not essential products.
Throwing in the news of shortages people tend to buy more thing that they need. Semiconductors are the new toilet paper.
Intel can fix this by buying back more of their shares.
@S3
Yeah! Especially if they use “their government funding” to buy the shares.
I now see this sort of message often which I have never seen before in my life:
1 left and then out of stock until mid-2022. The FPGA (Field Programmable Gate Array) used on it is unavailable from the manufacturer until then. I may have some back stock and there is one supplier I can try, but that supplier wants 3x the going price for it.
Yet another bizarre shortage effect:
First LOX, now liquid nitrogen causing launch delays. The launch of an Atlas V rocket and its Landsat 9 satellite from Vandenberg Space Force Base will have to wait at least a week due to liquid nitrogen delivery delays blamed on the COVID-19 public health crisis, Noozhawk reports. Trucks normally used to transport liquid nitrogen to Vandenberg were converted to LOX to meet higher demand from hospitals. Last week SpaceX officials cited a shortage of LOX, needed by hospitals, as one cause of launch delays.