Kill demand, supply goes up.
ZeroHedge- The Semiconductor Shortage Just Quickly Became An Inventory Glut
Names like Taiwan Semiconductor Manufacturing Co (TSMC), Advanced Micro Devices Inc (AMD) and Nvidia are now dealing with “unsold stockpiles” of inventory as a result of shrinking demand and cancelled orders, the report says.
This means that the years-long hold up for chips looks like it has officially come to an end.
We will be lucky if this collapse stops at a Recession, and doesn’t fall into a total economic Depression.
The DOW has been spiking up thousands of points in the last week. This may be the largest and longest DEAD CAT BOUNCE in trading history …
Do we still have a mismatch between what is being produced and what is needed, since a lot of what was needed wasn’t the cutting edge nVidia and AMD chips but older and bigger scale chips for automobiles and whatnot
The shortage of chips for automobiles wasn’t due to a lack of manufacturing capacity. The auto makers expected a decline in sales, so they didn’t order chips. The sales decline they expected didn’t happen, but the manufacturing capacity had already been reallocated to other customers, and since the auto makers were relying on Just In Time stocking (for parts with a several months to two year lead time) they had no on hand inventory to fill the gap.
Now they have gone “Oops,” ordered chips, and the decline is here, so there should be an overstock.
Don’t worry JD, Justin and Jagmeet have a solution; central planning.
Bureaucrats (based in Quebec) will prepare five year plans, forecast what is needed, prepare production plans, and allocate resources.
Of course what is needed (reference Klaus Schwab) and what the masses want, are two different things.
All left shoes.
Be glad you have one peasant and learn to hop.
Well, yeah. A combination of a crash in cryptocurrency and inflation making people’s priorities change.
Not exactly rocket surgery.
This “stockpile” talk is bullshit. There are serious shortages going on all over the place. In order to run a board you have to have everything there in the quantities specified in the run or the run isn’t happening. Board production is way down because of all the gaps. Missing one surface mount chip can keep production moving to the floor. If you delay, someone is going to use you inventory allocation on another board. It’s just crazy right now in the board production houses. There’s all kinds of black market activity going on.