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Why Russian Technology Is Screwed

Tuesday, March 29th, 2022

Welcome to another in the continuing “Why Russia’s X Is Screwed” series! It seems that Russia’s technological infrastructure is even more screwed than their airline industry.

Some takeaways:

  • If the sanctions are maintained, they will “almost certainly cause the collapse of Russia’s economy on short notice, and will set the country’s technological progress back by decades.”
  • Russian state entities and miltech was put in “a complete black box.”
  • “Even non-military end users were still barred from key technologies, such as semiconductors, telecommunication, encryption security, lasers, sensors, navigation, avionics and maritime technologies. Other countries from the EU to Japan and South Korea all imposed similar sanctions of their own.”
  • Even many private companies that lobbied for special carve-outs from sanctions changed their mind and suspended all business with Russia.
  • Just about every car and truck manufacturer. “95% of car parts in Russia are imported.”
  • Apple, Samsung, Dell, HP, Oracle, SAP, and Microsoft have all halted sales.
  • “Overnight, many industries in Russia are just gone.”
  • Every high tech company in Russia relies heavily on foreign inputs and expertise.
  • He talks about the embargo on semiconductors (more on this in the video below), but says that it applies even to chips made with embargoed tech. So if SMIC used an Applied Materials PVD machine, those chips couldn’t legally be shipped to Russia. I am skeptical this is actually the case (and it would be very hard to enforce on Chinese companies).
  • “The Russian economy did not prepare itself for sanctions anywhere near this severe.”
  • Two-thirds of Russia’s foreign reserves of $643 billion were parked abroad, which was all frozen when sanctions came down.
  • “Every part of the Russian economy has just received major damage, and there’s no way they can pivot everything all at once.”
  • “They’re simply not survivable in the long-term.”
  • Russia has increased interest rates to 20% to keep the ruble from collapsing further.
  • Even China has slowed-down or halted loans to Russian entities.
  • Russia is going to run out of cash “in a few weeks to a few months.”
  • Russia is heavily reliant on foreign tech, but for most tech companies, Russia is a minor market.
  • Expect a brain drain as wealthy and skilled Russians lose their jobs, then move abroad.
  • Many national industries simply cannot exist without foreign inputs. Substitutes would take years, if not decades.
  • Conclusion:

    If these sanctions continue, there will be no economy left to support the Russian military. Russian technological progress will be thrown back by years, if not decades, across the board. And in just a couple of weeks, or maybe months, the vultures will start circling, and they will start picking off every interesting
    Russian asset, every interesting Russian employee, oil fields, anything that they can get their hands on. And they’ll start transporting that out of the country as well. I cannot believe that Putin started a war expecting any sanctions anywhere near this scale.

    • Now on to semiconductors:

  • TSMC halted all shipments to Russia, as has AMD and Intel.
  • The Soviet Union had a massive technology gap between it and the United States, which only got worse as time went on.
  • All the computing power in every computer in the Soviet Union in 1991 combined would fall two generations short of a single Cray.
  • “The most advanced semiconductor production facilities were in East Germany, Belarus, Ukraine, and so on.”
  • JSC Mikron is Russia’s largest semiconductor manufacturer. “Today it fabs RFID tickets, SIM cards, and other smart card products.” They did about $260 million in business in 2020 (including government subsidies). They bought IP from STMicroelectronics.
  • In 2014, Mikron announced “the successful achievement of the 65 nanometer node at a volume of 500 200mm wafers a month.” [record scratch] 500 wafer starts a month??? That’s nothing. TSMC’s top of the line fabs generally do 120,000 wafer starts a month. It’s maybe OK if you’re running weird, demanding, high profit, low-volume processes (say, Gallium-Arsenide chips for use in satellites), but not for Mikron’s main business line (RFIDs).
  • But all that is beside the point, since they didn’t have a stepper capable of doing 65 nanometer. “Fujitsu, Toshiba, and TSMC started shipping their commercial 65 nanometer nodes in 2005. So this means that Russia’s gap with the leading edge has grown from 9 years to 15+.”
  • Russia’s Angstrem offers a wafer foundry doing “130 nanometer and 90 nanometer process nodes on 200mm wafers. Their capacity is about 180,000 wafers a year.” They declared bankruptcy around 2019. They were also hit by U.S. sanctions after the Crimean invasion. Successor company NM-Tech has a pie-in-the-sky plan to do 10nm in 10 years. Don’t hold your breath.
  • (I notice he makes no mention of “Crocus Nano Electronics,” which supposedly runs Russia’s only 300mm wafer fab (“Established in 2011, Crocus Nano Electronics is the world’s first and only 300mm fabrication facility, located in Russia”), but when you get down into their press releases, it says “The development and production of Crocus Nano Electronics ReRAM memory chips were manufactured on 55 ULP CMOS by Shanghai Huali Microelectronics Corporation (HLMC).” So either they’re a fabless design house, or they only do the metal interconnects fabrication and nothing else in the process, which is so weird a model I can’t really wrap my head around it.)
  • I’m omitting the coverage of various fabless design houses, since they’re dead-in-the-water without access to decent foundry technology or foreign markets.
  • They can probably get stuff fabbed at China’s SMIC.

    • If Russia had turned into a regular country after 1991, there’s no reason they couldn’t have launched a competitive domestic tech industry. The Soviet Union had large number of frequently bloody flaws, but they didn’t stint on STIM education, and maintained very competitive space capabilities despite numerous handicaps. But instead, they turned into a corrupt oligarchy-turned-dictatorship, and all that human capital either emigrated or withered on the vine.

    And now, thanks to Vlad’s Big Ukraine Adventure, they’re even more screwed than they were before.

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    Posted in Economics, Foreign Policy, Military, video | 11 Comments »

    LinkSwarm for February 25, 2022

    Friday, February 25th, 2022

    Ukraine fights back, Biden isn’t going to do jack about it, Kyle Rittenhouse is going to sue everyone, inflation soars, the Canadian “emergency” is ended, disaster looms for Democrats, and Ilhan Omar gets an unusual challenger. It’s the Friday LinkSwarm!

  • Ukraine forces have retaken Antonov International Airport, AKA Gostomel, AKA Hostomel.

    While reports of the battle are confused and preliminary, it appears that Ukrainian forces counterattacked, shot down some Russian helicopters, and have so far been able to prevent the Russians from landing reinforcements. Initial claims that the Russian force at the airfield had been “destroyed” were later clarified; it now seems that the battle at Gostomel is continuing. It’s easy to understand how crucial this battle is, simply by looking at a map. If the Russians could gain control of the Gostomel airfield, they could score a quick knock-out of the Ukrainian capital as part of what is being called their “decapitation” strategy.

    Russian news services are claiming they’ve taken the airfield, but that may be stale news or propaganda.

  • There are conflicting reports whether the the Antonov An-225 Mriya (the largest aircraft in the world) stationed there has been destroyed or not
    

  • Ukrainian forces take up positions in Kiev. Also: “Reports that the Ukrainian military has delivered a strike on a Russian airfield in Millerovo, Rostov Oblast have now been confirmed.”
  • Chuck DeVore: “Has Putin Miscalculated His Ability To Take Ukraine Swiftly?”

    The invasion of Ukraine by the armed forces of Russia at Russian President Vladimir Putin’s orders marks the first time since 1945 that Russia has engaged in a conventional war with a near-peer nation.

    Ukraine isn’t restive Warsaw Pact nations, it isn’t Afghanistan, it isn’t Chechnya, it isn’t Georgia, and it isn’t Crimea.

    The conflict launched by Putin is on a far grander scale than the invasion of Crimea in 2014, launched as Ukraine’s last pro-Russia president, Viktor Yanukovych, was driven from office in a popular uprising.

    Putin, by choosing to reach beyond the ethnic-Russian majority separatist provinces of Donetsk and Luhansk in the Donbas Basin, has decided to end the independent, Western-looking Ukrainian government of President Volodymyr Zelenskyy and install a pro-Putin quisling.

    And while the fog of war, some deliberate mis-and disinformation operations by the combatants, and the far-from-perfect filter of Western media leaves much unknown at this time, what is known is that Zelenskyy is still in power a day after the Russian offensive. Further, the Ukrainian military appears to be taking a toll on the Russians invading from three sides: south across the Pripyat Marshes from Russian satellite Belarus; west from Russia, including Donbas; and north from the Black Sea in the region of Odessa and Transnistria, a Russian client breakaway state in Moldavia.

    Modern conventional war is extremely difficult to do well. Imagine being a conductor of an orchestra, all while the audience was lobbing soccer balls at you and your musicians as you perform J.S. Bach’s Chaconne in D — that’s modern warfare. Putin is attempting a highly complicated operation over large distances in the face of a determined foe. Further, he’s doing so with an army largely composed of conscripts serving for only one year.

    Since Putin has decided to oust the Ukrainian government, this means that every day Zelenskyy remains in office is another day that adds to Ukrainian national confidence to resist — and another day that Putin looks to have miscalculated.

  • White House claims Russian forces are 20 miles outside Kiev.
  • Tweets from the war zone:

  • Both the EU and the Biden Administration offer sanctions they admit will not do Jack Squat.

  • But the UK is Freezing Putin assets…assuming he has any.
  • Holy Fark is this unbelievable incompetence and naivete:

  • Taiwan joins sanctions against Russia, including their semiconductor industry. I don’t know if any fabless Russian chip design company gets their chips fabbed at TSMC, so I’m not sure how badly this hurts their economy in the long run.
  • “You Can Thank Environmentalists for the Invasion of Ukraine.”

    It is the West’s wacko environmentalists who handed Russian President Vladimir Putin the leverage and money to invade Crimea in 2014 and Ukraine this week.

    Without these wackos, Putin would be just another gangster in charge of a crumbling country, and maybe one on the verge of a revolution to depose him.

    But the facts are the facts are the facts, and the facts are these… Thanks to the West’s environmentalists, those smug greenies who are more concerned with carbon output than world peace, this gangster controls much of the energy going to the European Union (E.U.).

    Thanks a lot, Greta…

  • A great mystery:

  • Enjoy these cringy social justice takes on Ukraine.

    (Hat tip: Stephen Green at Instapundit.)
    

  • Biden is demonstrably more hostile to American oil and gas companies than he is to Russian companies, having frozen oil and gas leases despite a court order otherwise.
  • Thanks to Biden’s inflation, the cost of everything is going up. “70 percent of Americans are living paycheck to paycheck.”
  • Due to either bad polling or raw panic among his party, Canada’s Justin Trudeau rescinded his Emergencies Act declaration.
  • Matt Taibbi on Canada’s dangerous new dystopian powers:

    Fellow former finance reporter Chrystia Freeland — someone I’ve known since we were both expat journalists in Russia in the nineties — announced last week that her native Canada would be making Sorkin’s vision a reality. Freeland arouses strong feelings among old Russia hands. Before the Yeltsin era collapsed, she had consistent, remarkable access to gangster-oligarchs like Boris Berezovsky, who appeared in her Financial Times articles described as aw-shucks humans just doing their best to make sure “big capital” maintained its “necessary role” in Russia’s political life. “Berezovsky was one of several financiers who came together in a last-ditch attempt to keep the Communists out of the Kremlin” was typical Freeland fare in, say, 1998.

    Then the Yeltsin era collapsed in corrupt ignominy and Freeland immediately wrote a book called Sale of the Century that identified Yeltsin’s embrace of her former top sources as the “original sin” of Russian capitalism, a “Faustian bargain” that crippled Russia’s chance at true progress. This is Freeland on Yeltsin’s successor in 2000. Note the “Yes, Putin has a reputation for beating the press, but his economic rep is solid!” passage at the end:

    It looks as if we’re about to fall in love with Russia all over again…

    Compared to the ailing, drink-addled figure Boris Yeltsin cut in his later years, his successor, Vladimir Putin, in the eyes of many western observers, seems refreshingly direct, decisive and energetic… Tony Blair, who has already paid Putin the compliment of a visit to Russia and received the newly installed president in Downing Street in return, has praised him as a strong leader with a reformist vision. Bill Clinton, who recently hot-footed it to Russia, offered the equally sunny appraisal that “when we look at Russia today . . . we see an economy that is growing . . . we see a Russia that has just completed a democratic transfer of power for the first time in a thousand years.”

    To be sure, some critics have lamented Putin’s support for the bloody second war in Chechnya, accused him of eroding freedom of the press…and worried aloud that his KGB background and unrepenting loyalty to the honor of that institution could jeopardize Russia’s fragile democratic institutions. But many of even Putin’s fiercest prosecutors seem inclined to give him the benefit of the doubt when it comes to the economy…

    Years later, she is somehow Canada’s Finance Minister, and what another friend from our Russia days laughingly describes as “the Nurse Ratched of the New World Order.” At the end of last week, Minister Freeland explained that in expanding its Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) program, her government was “directing Canadian financial institutions to review their relationships with anyone involved in the illegal blockades.”

    The Emergencies Act contains language beyond the inventive powers of the best sci-fi writers. It defines a “designated person” — a person eligible for cutoff of financial services — as someone “directly or indirectly” participating in a “public assembly that may reasonably be expected to lead to a breach of the peace.” Directly or indirectly?

    She went on to describe the invocation of Canada’s Emergencies Act in the dripping-fake tones of someone trying to put a smile on an insurance claim rejection, with even phrases packed with bad news steered upward in the form of cheery hypotheticals. As in, The names of both individuals and entities as well as crypto wallets? Have been shared? By the RCMP with financial institutions? And accounts have been frozen? As she confirmed this monstrous news about freezing bank accounts, Freeland burst into nervous laughter, looking like Tony Perkins sharing a cheery memory with “mother.”

  • Angeleno’s tax dollars at work:

  • China is getting a good return on its investment in the Biden clan: “DOJ shuts down China-focused anti-espionage program. The China Initiative is being cast aside largely because of perceptions that it unfairly painted Chinese Americans and U.S. residents of Chinese origin as disloyal.” We can’t let national security stand in the way of political correctness…
  • The Covid-theater crazies are about to throw in the towel.

    In what may be remembered as one of the greatest miracles of all time, it seems that an upcoming American election cycle is set to put an end to the great COVID pandemic in regions that have been clinging to “mitigation” tactics despite them being proven ineffective long ago. What science couldn’t do for blue state governors, politics is about to. Meanwhile, much of the rest of the country has already adopted an “endemic” approach to COVID. In my Indiana community, for instance, school systems have been in-person and maskless for well over a year.

    A combination of experience and common sense led local officials to recognize that while COVID was a serious virus, and an often-times unpleasant condition to endure, we just weren’t experiencing the kind of mortality rates or critical hospitalizations that would require the suspension of normal life. If I was guessing, I would say that there are more counties, cities, and communities in the United States like mine than not.

    While mainstream media may be drawn like a moth to the bright lights of urban areas with all the restrictions, mandates, and panic-fueled policies enacted there, most Americans have been “living with” the virus for a long time now.

    In fact, if my community is any bellwether for the nation, most Americans are already wondering why anyone is still attempting to take a non-endemic approach at this point. The virus has proven itself to be, like all other viruses, prone to seasonal surges that are largely unaltered by our theatrical mitigation techniques. Not that anyone with their head screwed on straight ever thought there was value in wearing a porous cloth mask while standing up at a restaurant, then taking it off while sitting down, but the comical nonsense of mask histrionics is now widely appreciated as a goofy spectator sport. Behold:

    So silly. And so as opinion polls continue showing that an ever-increasing number of Americans are infuriated by this nonsense, and that they are done with all the aggressive pandemic restrictions that proved unnecessary a long time ago, a public pivot of massive proportions is underway amongst the political class.

    Whether it’s big blue state governors like California’s Gavin Newsom hilariously announcing that he will be transitioning his state to the country’s first “endemic” virus policy – meaning they’re going to start doing some things that Texas, Florida, South Dakota, Indiana, and so many others have been doing for over a year – or whether it’s blue city school boards like San Francisco’s being recalled by angry voters for their abusive and needless shutdown and masking policies, it’s clear where we’re headed.

  • Despite that, the midterm news for Democrats is not good.

    Democrats know that they should be preparing for a brutal showing in this November’s midterm elections. Glenn Youngkin’s victory in the Virginia gubernatorial race last year — and, more to the point, the substance and style of his successful campaign — were the first sign of it.

    But the hits have kept on coming. In San Francisco last week, two progressive parents succeeded in their campaign to oust three school-board members for being . . . too progressive. Irked initially at how long it was taking for area schools to reopen for in-person learning during the pandemic, these two single parents did some digging and discovered even more to be upset about: an enormous budget shortfall, an intensive campaign to rename dozens of school buildings, and the replacement of a merit-based admissions program with a diversity-minded lottery, among other issues.

    Suggesting just how central education has become to politics, San Francisco’s intensely progressive mayor, London Breed — who last fall violated her own mask mandate at a concert and defended herself by saying she was “feeling the spirit” — endorsed the school-board recall effort.

    “My take is that it was really about the frustration of the board of education doing their fundamental job,” Breed said after the results were in. “And that is to make sure that our children are getting educated, that they get back into the classroom. And that did not occur. . . . We failed our children. Parents were upset. The city as a whole was upset, and the decision to recall school-board members was a result of that.”

    San Francisco–based writer Gary Kamiya suggests in a piece for the Atlantic that the results of the recall seem to confirm the conservative narrative. Kamiya writes that conservatives have argued “that the Democratic Party is out of step not just with Republicans, but with its own constituents. . . . Progressives rejected such conclusions, insisting that the recall was simply about competence and was driven by an only-in-San-Francisco set of circumstances.” Kamiya concludes that the best way to read the outcome is “closer to the conservative view.” “At a minimum,” Kamiya writes, “the recall demonstrates that ‘woke’ racial politics have their limits, even in one of the wokest cities in the country.”

    Over in Texas, meanwhile, failed Senate candidate and failed presidential hopeful Beto O’Rourke is gearing up to become a failed gubernatorial candidate, too. Running against incumbent Republican governor Greg Abbott, O’Rourke was most recently seen trying to pretend that he isn’t a fan of radical gun-control measures.

    Asked about the promise he made during his run for president that he would “take away AR-15s and AK-47s,” O’Rourke attempted a hard about-face.

    “I’m not interested in taking anything from anyone,” he said. “What I want to make sure that we do is defend the Second Amendment. I want to make sure that we protect our fellow Texans far better than we’re doing right now. And that we listen to law enforcement, which Greg Abbott refused to do. He turned his back on them when he signed that permitless-carry bill that endangers the lives of law enforcement in a state that’s seen more cops and sheriff’s deputies gunned down than in any other.”

    As Charlie Cooke has noted, this is utter tripe. It also isn’t working. The latest poll of the race from the Dallas Moring News has Abbott up by seven points, 45 percent to 38 percent. O’Rourke himself remains underwater with voters: Only 40 percent view him favorably, while 46 percent say they have an unfavorable view of the candidate.

  • Republicans win a Jacksonville City Council race:

  • Speaking of Florida:

  • A nice guide to recent incidents of election fraud.
  • Texas sues ATF over silencers.
  • Denounce antifa violence at a leftwing think tank? You know that’s a firing!
  • Kyle Rittenhouse is finally ready to sue, including lawsuits against Whoopi Goldberg and Cenk Uygur. I hope he bankrupts anyone who called him a white supremacist.
  • Former Houston Rockets draft bust Royce White is running for Congress as a Republican against “Squad” member Ilhan Omar. Hopefully he can be on the campaign trail more than he was on the floor for the Rockets…
  • Another day, another hate crime hoax.
  • Commies gonna commie:

  • There’s a huge fight going on between Qatar Airways and Airbus over quality control issues. Boeing may be the beneficiary.
  • It takes under 20 seconds for the Lock-Picking Lawyer to defeat the mailbox lock the government requires you to use.
  • A long, detailed look at what Peter Jackson’s Get Back documentary shows us about The Beatles creative process. (Hat tip: Ed Driscoll at Instapundit.)
  • Uncomable Hair Syndrome.
  • “Massacre As Great White Shark Allowed To Compete In Women’s 500 Freestyle.”

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    Posted in Communism, Democrats, Economics, Elections, Foreign Policy, Guns, Military, Regulation, Republicans, Social Justice Warriors, Texas | No Comments »

    Semiconductor Subsidies: The Wrong Solution For The Wrong Problem

    Thursday, January 20th, 2022

    There’s no problem that the federal government throwing money at it can’t make worse.

    Today’s example: Democrats pimping billions in taxpayer subsidies for the semiconductor industry.

    As the COVID-19 pandemic exacerbates supply chain backlogs and global computer chip shortages

    Correction: It wasn’t the pandemic itself, it was government lockdowns and other overeactions that did that.

    Democratic leaders in Congress as well as President Joe Biden want Congress to fast track a $250 billion bill to develop American independence from China and other competitors in chip manufacturing.

    The Capital Region – home to SUNY Polytechnic Institute, the only publicly owned 300-millimeter semiconductor research and development center in the U.S. – stands to reap significant benefits from the enactment of Senate Majority Leader Charles E. Schumer’s multi-billion dollar bill, which he envisions as a direct investment in his home state’s economy.

    “Sen. Schumer wrote this legislation with upstate New York always at the forefront of his mind,” Schumer’s spokeswoman Allison Biasotti said. “We are already seeing the excitement in major employer expansions and thousands of jobs on the horizon from GlobalFoundries’ planned expansion (in Malta) and (his) push for Albany Nanotech to be a hub for the National Semiconductor Technology Center.”

    A focal point of the bill, which the New York Democrat co-sponsored with Sen. Todd Young, R-Ind., is a historic $52 billion investment in stateside semiconductor research and development to address a global chip shortage plaguing the automotive industry.

    Lawmakers began to focus more on the low domestic production of semiconductors when the COVID-19 pandemic cut off supplies from overseas. Without access to chips, several automakers shut down their production lines, and manufacturers of essential medical devices and consumer electronics struggled to meet increasing demand.

    Roughly 12 percent of the world’s semiconductors are manufactured in the United States, down from 37 percent in 1990, according to the Semiconductor Industry Association.

    Either these stats are false or misleading (probably the latter). The most recent stats I can find show that the United States has some 47% of the semiconductor market. It’s possible that the 12% refers to the entire worldwide number of individual chips produced, including discrete components (transistors, resistors, etc.). Those are indeed semiconductors, but they’re produced on old amortized fabs (inside the industry these are referred to as “jelly bean factories”) and sell for pennies a piece (or less). If you’re already in that industry, those old fabs make small, steady profits every year, but nobody jumps into that business with new fabs.

    The chips China make are generally either: A.) Cheap, or B.) intended for their internal market. No one sends cutting edge chips to be fabbed in China because they don’t have the tech to do it and everyone know they’ll steal your designs and crank out knock-offs on the sly whenever possible. China’s semiconductor industry is mostly smoke and mirrors all the way down.

    Semiconductor subsidies have all the hallmarks of a classic Washington boondoggle: The wrong action at the wrong time for the wrong problem.

    First, there are already signs that the automotive semiconductor crunch is easing, thanks not to the Biden Administration but to the actions of the free market.

    Second, the shortage wasn’t the result of a “chip shortage,” it was the result of “a lack of available foundry wafer starts.” Automakers cancelled their orders for display drivers when it looked like Flu Manchu lockdowns were going to depress the economy for a while, and were caught off-guard by the V-shaped recovery under Trump, and got sent to the back of the line to get their product fabbed after they changed their mind. Remember, just about all foundries are running flat-out 24/7/365, pausing only to switch to different chips for different customers. There’s no slack in the system, and those wafer starts are already spoken for (and possibly paid for) by other customers well in advance. Just as nine woman can’t give birth to a fully grown baby in one month, you can’t just “make chips quicker” in an existing fab.

    Third, remember that cutting edge semiconductor fabs are hideously expensive. Moore’s second law states that the cost of a new, cutting edge semiconductor plant doubles every four years. Samsung’s planned fab in Taylor, Texas is going to cost $17 billion.

    Fourth, if you go to a random semiconductor company and go “Here’s 20 billion! Go build a state-of-the-art 5nm wafer fabrication plant!”, then:

    A.) You’re looking at a very minimum of 2-3 years before the first production wafer comes off the line. You can’t just take an existing building and turn it into a fab, it has to be specially built from the ground up with exacting standards for cleanroom air filtering, concrete slab level uniformity, etc. And 2-3 years is probably the lead time to get an ASML EUV stepper.

    B.) Unless you’re TSMC, Samsung or (maybe) Intel, the answer is probably “Uh, we’ll try, but no promises,” because those three companies are the only ones that actually having wafer fabs running 10nm or smaller process nodes. GlobalFoundries, mentioned in the article, has Fab 8 in Malta, NY, running 14nm, which is not horribly far off the state-of-the art, but not good enough to fab the really cutting-edge chips demanded of companies like Apple, NVIDIA, etc. Tiny problem: In 2018, GlobalFoundries stopped all work on 7nm development.

    The contract maker of semiconductors decided to cease development of bleeding edge manufacturing technologies and stop all work on its 7LP (7 nm) fabrication processes, which will not be used for any client. Instead, the company will focus on specialized process technologies for clients in emerging high-growth markets. These technologies will initially be based on the company’s 14LPP/12LP platform and will include RF, embedded memory, and low power features.

    So it was too hard a game for them to play, but with a big heap of taxpayer subsidies, I’m sure they’d be willing to give it another go.

    Of course, you don’t need a cutting edge fab to build display drivers. Bosch just opened a $1.2 billion, 65nm fab in Dresden to do just that. But you don’t need subsidies to build trailing edge fabs.

    $250 billion in taxpayer subsidies wouldn’t get you a single additional wafer start this year, and probably would accomplish little more than channeling money to politically connected firms and sticky pockets in a state (New York) that no one wants to build fabs in any more because of high costs, high taxes and union rule requirements.

    It’s a bad idea congress should reject.

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    Posted in Democrats | 3 Comments »

    Supply Chain Update for October 28, 2021

    Thursday, October 28th, 2021

    Another week, another roundup on the supply chain issues plaguing America and the world.

  • The supply chain problem is one of the big reasons economic growth dropped to an anemic 2% in Q3. The Trump boom/post-Flu Manchu recovery has ended, and the Biden economy has kicked in.
  • Here’s a pretty revealing thread about the Los Angeles/Long Beach Port problems:

    All this, of course, is on top of the previous banning of older trucks and non-union owner operators.

  • But remember: There’s no problem a government “solution” can’t make worse: “Biden hopes fines on lingering cargo containers ease congestion at major U.S. ports.” “The twin ports of Los Angeles and Long Beach will charge carriers $100 per day for each container lingering past a given timeline starting Nov. 1.” Yeah, that’s going to magically conjure trucks and drivers out of thin air.
  • Another problem is the change in containers, and the requirements for matching truck chassis types, has added still another point of failure (from 2015):

    Ten years ago, the largest container vessels that entered the ports carried 8,500 twenty-foot containers, or TEUs. Each shipping company operated their own cargo ships. The containers inside were generally all the same, and they were loaded systematically for efficient unloading at each dock.

    Now, the ships are much larger, carrying 14,000 TEUs, said Philip Sanfield, a spokesman for the Port of Los Angeles, adding that the ships are only getting bigger, and soon ships carrying 16,000 TEUs will enter the seas. The companies have begun forming alliances with one another to share these larger ships. Each company’s cargo containers are different – so it takes longer for dock workers to sort and unload them. It saves the shipping companies money, but makes for longer hours for dock workers and truckers.

    “That’s an inefficiency in the system that is driven by an efficiency: the move toward larger vessels,” says Thomas O’Brien of the Center for International Trade and Transportation at Cal State Long Beach. “But the impact is felt on the dock side.”

    One example of how this plays out: a truck driver spends hours waiting at the docks for the container he or she has been assigned to haul, which has to be moved from the bottom of a tall stack of other containers.

    But even before waiting for a cargo container, the driver must be matched with a chassis – the trailer that the container sits on top of. That process also involves a lot of waiting, and often some hunting. Drivers have to find one that will match the cargo container that he or she has been assigned to haul.

    In the past, this matching process was relatively simple because the shipping companies also owned their own chassis fleets and managed them from their shipyards.

    But during the recession, the shippers got out of the chassis business, turning them over to third-party companies to lease and maintain. The transition has created scattered mix of chassis on various terminals, and ultimately, a chassis shortage at a time when bigger ships are showing up with more cargo. Truckers told KPCC it’s difficult for them to know where they can find a chassis that will match the container they are assigned to haul, and often find themselves on what amounts to a wild goose chase.

    “There were times, when we would have 10 to 15 guys looking for one particular chassis, and we just had to wait,” said Danny Lima, the employee truck driver. “I heard stories that there are no chassis at one certain terminal because they were all at another terminal. “

    “I’m praying that there is going to be a chassis,” says Rafael, the independent trucker. “Because I can spend an hour driving around the terminal looking for chassis.”

  • Another problem: California’s Flu Manchu restrictions.

    California had some of the most stringent COVID-19 limitations of any state in 2020 when the horrendous backlog began. There was a need for more workers as demand for imported goods was skyrocketing, but California had far fewer available due to drastic government restrictions.

    In addition, overly generous government unemployment payouts reduced the need or incentive for people to work, reducing the available supply of willing truckers or longshoremen.

    When the supply chain is pinched like this, inflation rears its ugly head.

    Federal Reserve Chairman Jerome Powell has blamed recent inflation on supply chain bottlenecks. When these bottlenecks occur, consumers and businesses soon experience shortages of basic commodities and goods like new and used cars, washing machines, or medical supplies. Inflation soon follows.

    Unfortunately, many bottlenecks in supply chains occur because of government meddling.

    Politicians’ recent alarm over the Port of Los Angeles should be focused on how government officials forced docks and logistics companies, and everyone else, to follow everchanging, arbitrary COVID-19 restrictions, which worsened repeated green and labor mandates that have gummed up supply chains for years.

  • A trade group for air cargo companies like UPS and FedEx is urging the Biden Administration to push out the vaccine mandate:

    A trade group for air cargo giants like UPS and FedEx is sounding the alarm over an impending Dec. 8 vaccine deadline imposed by President Joe Biden, complaining it threatens to wreak havoc at the busiest time of the year — and add yet another kink to the supply chain.

    “We have significant concerns with the employer mandates announced on Sept. 9, 2021, and the ability of industry members to implement the required employee vaccinations by Dec. 8, 2021,” Stephen Alterman, president of the Cargo Airline Association, wrote in a letter sent to the Biden administration and obtained by POLITICO.

    The letter, sent to the Office of Management and Budget , asks the administration to postpone the deadline until “the first half of 2022.” At issue is the requirement by the Biden administration that federal workers be fully vaccinated by Dec. 8. Unlike private businesses, companies that act as federal contractors cannot opt out by instead submitting their workforces to frequent Covid testing.

    (Hat tip: Not the Bee.)

  • Our supply chain problems are a culmination of years of bad policy decisions by America’s elites:

    Our vulnerability to supply chain disruption clearly predates the Biden Administration, forged by the abandonment of the production economy over the past 50 years by American business and government, encouraged and applauded by the clerisy of business consultants. The result has been massive trade deficits that now extend to high-tech products, and even components for military goods, many of which are now produced in China. When companies move production abroad, they often follow up by shifting research and development as well. All we are left with is advertising the products, and ringing up the sales, assuming they arrive.

    Unable to stock shelves, procure parts, power your home, or even protect your own country without waiting for your ship to come in, Americans are now unusually vulnerable to shipping rates shooting up to ten times higher than before the pandemic. Not surprisingly, pessimism about America’s direction, after a brief improvement Biden’s election, has risen by 20 points. The shipping crisis is now projected to last through 2023.

    Not everyone loses here. For years the American establishment saw China as more of an opportunity than a danger. High-tech firms, entertainment companies, and investment banks profit, or hope to, from our dependency, becoming in essence the new “China lobby.” Behind the scenes these representatives of enlightened capital often work to prevent condemnation for the Middle Kingdom’s mercantilist policy, and its joint repression of democracy and ethnic minorities.

    After all, the pain is not felt in elite coastal enclaves, but in Youngstown, south Los Angeles, and myriad other decaying locales. Meanwhile, by enabling China’s focus on production, and the conquest of technologies related to making goods, we have devastated large parts of our country. This shift has cost us 3.7 million jobs since 2000. Throughout the period between 2004 and 2017, the U.S. share of world manufacturing shrank from 15 to 10 percent, while our reliance on Chinese inputs doubled, even as our dependence on Japan and Germany shrank.

    Snip.

    Some businesses are catching the drift. McKinsey and Company surveyed supply chain executives last year and found that nearly all respondents agree that their supply chains are too vulnerable. According to March 2020’s Thomas Industrial Survey, COVID-19 supply chain disruptions accelerated the search for locally-sourced materials and services. Up to 70 percent of firms surveyed said they were “likely” or “extremely likely” to re-shore in the coming years.

    The exodus from China also includes Asian and other foreign firms. UBS projects 20 to 30 percent of all Chinese capacity moving, which on $2.5 trillion of Chinese exports would imply $500 billion to $750 billion shifting elsewhere, notably to the big market of North America. Last year, Taiwan Semiconductor Manufacturing, the world’s leading chip foundry, decided to build a $12 billion new plant in Arizona, and Samsung, a huge Korean chipmaker, is also shopping in the United States for a $17 billion plant. This would remove one of the most devastating causes of supply chain problems, which has dramatically slowed auto production.

    Some major American companies, including Black and Decker, Whirlpool, General Electric, Apple, Caterpillar, Goodyear, General Motors, Little Tykes, and Polaris have begun to reshore some production. They are not alone. In 2019, for the first time in a decade, the percentage of United States manufacturing goods that were imported dropped, notes a recent Kearny study, with much of the shift coming from east Asia.

  • “After years of ‘Made in China,’ supply chains consider alternatives.”

    The “Made in China” label is ubiquitous in the United States, stamped on everything from industrial machinery to a pair of flip flops. But risks — from rising costs, to a trade war, to a pandemic — have prompted companies to rethink their relationships with suppliers and China.

    “We’ve realized that we put too much power in a single country,” said Dawn Tiura, CEO of Sourcing Industry Group.

    Snip.

    The same risk factors that drove supply chains to diversify also drove them to think about reshoring to the U.S. Proximity allows shorter transit times, lower emissions and the ability to tout a “Made in USA” label. Import duties are no longer a concern. Total cost of ownership is often lower.

    A Thomas study that polled respondents in March found 83% of manufacturers are likely, very likely or extremely likely to reshore, up from 54% in March 2020. But reestablishing manufacturing bases in the U.S. could prove challenging, after decades of standing them up in Asia and Latin America.

    “It is extremely difficult to reverse the 30+ year trend of outsourcing and offshoring manufacturing to emerging market countries,” a chemical manufacturer in the Thomas survey said. “We no longer have the talent and expertise nor capital equipment to effectively manufacture key critical components of major products and assemblies.”

  • “Ace Hardware Shelves Go Bare While Supply Chain Crisis Rages.” “We order twice a week. Normally it just takes two or three days to get back in stock on something…But during the pandemic and then with a certain category being out of stock, we’ve been out of certain products for three or four months.”
  • More on part supply shortages:

  • Health supplies:

  • Heh:

    As far as local conditions in Texas, I can say that I’m only seeing small disruptions in the grocery store supply chain at my local HEB. Luncheon meat was very short there on a recent visit, but I didn’t notice any other particular absence. A few weeks ago, the big Member’s Mark store brand toilet paper at Sam’s was completely out, but it had been completely refilled a week later.

  • Reminder:

  • Here’s a piece that says lazy crane operators are to blame, according to some truck drivers. “The crane operators take their time, like three to four hours to get just one container.” Eh, something about this doesn’t ring true. Maybe they had to wait three or four hours for the operator to get their container off the stack.
  • Is the supply chain problem being deliberately inflicted on the American people to force them to swallow the vaccine mandate?

    Deputy Treasury Secretary Wally Adeyemo may have accidentally leaked the cause of America’s supply chain issues.

    “The reality is the only way we’re going to get to a place where we work through this transition is if everyone in America and everyone around the world gets vaccinated,” Adeyemo admitted in an interview with ABC News.

    Starve them out, let the dissenters suffer, and those who bought into this agenda will turn against them.

    Adeyemo said that the Biden Administration has already provided “the resources the American people need to make it to the other side.”

    Basically, everyone should give into the vaccine mandate or face the consequences. They are masking authoritarianism as utilitarianism. The vaccine has not been mandated at the federal level in the US, yet, but it is apparent that the government plans to make life as difficult as possible for those who do not obey.

    Echoing the Fed, Adeyemo said that inflation is “transitory,” and “as part of the transition we are seeing higher pieces for some of the things people have to buy… That’s exactly why the president was focused in the American Rescue Plan in ensuring on getting stimulus into the hands of the American people, so they’d be able to buy the products they need.”

    Yes, the government expects us, the Great Unwashed, to be thankful for their measly handouts to purchase unavailable products at an all-time high. There is a reason people have recently nicknamed the president “bare shelves Biden,” with the hashtags #BareShelvesBiden and #EmptyShelvesJoe becoming a viral sensation.

    Although the Biden Administration met with the Ports of Long Beach and Los Angeles, which handles 40% of the nation’s goods, the promise of a 24/7 operation has not yet occurred. There is no ETA for when the ports will begin 24/7 operations either. Some ships are allegedly waiting 12 days at anchor before reaching the dock, and over 60 vessels are idled in the San Pedro Bay at the moment. With one of the nation’s busiest shopping holidays approaching (Black Friday) followed by ongoing seasonal shopping, this matter is likely to turn ugly.

  • Other voices of the same opinion

  • Relevant to LA and Long beach’s problems: “Port of Houston Awards Contract to Begin Houston Ship Channel Dredging.”

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    Posted in Democrats, Economics, Regulation, unions | 6 Comments »

    China’s Semiconductor Industry: Shell Games All The Way Down

    Wednesday, April 7th, 2021

    I’ve written about China’s semi-illusory semiconductor businesses before: “In China the question is always how much of that investment is real, and how much is illusion. A lot of those ‘under construction’ fabs never materialize, either unable to attract investors or having their funds magically siphoned off to some other enterprise.” While researching yesterday’s piece on the current semiconductor shortage, I came across this Emily Feng NPR piece on more multi-million dollar shenanigans in that space:

    In 2019, the U.S. sanctioned two major Chinese telecom firms, temporarily cutting them off from a vital supply of semiconductor chips — bits of silicon wafer and microscopic circuitry that help run nearly all our electronic devices.

    Wuhan Hongxin Semiconductor Manufacturing Co. promised a way out, toward self-reliance in the face of increasingly tough U.S. curbs on this technology. The private company once boasted on its website that it would raise a total of $20 billion to churn out 60,000 leading-edge chips a year.

    None of that would come to pass.

    Hongxin’s unfinished plant in the port city of Wuhan now stands abandoned. Its founders have vanished, despite owing contractors and investors billions of yuan.

    The company is one of six multibillion-dollar chip projects to fail in the last two years. Their rise and fall is a cautionary tale in an industry that is flush with state cash but still scarce on expertise — and a preview of the expensive and winding road China will have to take toward semiconductor self-sufficiency, now a national security priority.

    Hongxin Semiconductor began in November 2017 as a joint venture between Wuhan’s Dongxihu district government and a company called Beijing Guangliang Lantu Technology.

    The venture got off to a good start — on paper — but a closer look shows there were a number of issues. One of the co-founders of Guangliang had only finished elementary school and was allegedly using false credentials and a different identity, Cao Shan, according to 36Kr, a Chinese tech news outlet. Another co-founder, Li Xueyen, dabbled in selling Chinese traditional medicine, alcohol and tobacco before starting Hongxin, according to corporate records reviewed by NPR.

    These are not the profiles you look for in semiconductor startup founders.

    The two could not be reached for comment.

    Yeah, I bet.

    To balance out their lack of technical know-how, the Hongxin founders lured in one of Taiwan’s most famous semiconductor engineers, Chiang Shangyi, to serve as director. He left the company in 2020 to become the deputy chairman of China’s Semiconductor Manufacturing International Corp., telling Hong Kong paper South China Morning Post that his time at Hongxin was “a nightmare.” Chiang did not respond to NPR requests for comment.

    Hongxin made headlines in December 2019 when it managed to buy an older model lithography machine made by Dutch company ASML, despite American lobbying to prevent its sale to the Chinese chipmakers.

    OK, on the face of it that sounds pretty impressive. If you want to have a cutting edge fab, you have to have one of ASML’s top of the line Extreme Ultraviolet (EUV) steppers. In almost every other segment in the semiconductor equipment market, there’s competition between the three big players (Applied Materials, LAM Research and Tokyo Electron) and occasionally other companies (like Axcelis for ion implanters). But while you might be able to get away with lesser Deep Ultraviolet (DUV) lithography machines from Nikon or Canon for some tasks, for the smallest features on cutting edge 7 and 5nm nodes, you simply can’t do without an ASML EUV stepper. (More background here.)

    Well, guess what? The vaunted ASML tool Hongxin bought is apparently an older 1980 model (presumably this one, which dates from 2015, not 1980) which is DUV, not EUV.

    Back to the NPR piece.

    ASML sold the multimillion dollar piece of equipment — used to etch semiconductors — because of Jiang’s top-notch reputation, according to two people familiar with the sale who were not authorized to speak publicly about it. ASML declined to comment.

    Feng (or her editors) goofed here. ASML makes lithography machines, not etch tools.

    Hongxin’s timing was opportune. Chinese chip companies still rely heavily on European, American and Japanese technology — much of which, in turn, relies on American intellectual property, which the U.S. appears determined to keep out of Chinese hands. China’s semiconductor demand continues to surge beyond what it can supply itself; trade data show that in 2019, Beijing imported around $350 billion worth in chips.

    Given that reliance, China’s central and local governments have been pumping money into the sector to accelerate domestic chip design and manufacturing. The country’s latest five-year economic planning document released in March identifies integrated circuits — semiconductors — as a priority sector for research and development funding.

    When governments starts pumping big money into private companies, you can be sure multiple scams are never far behind.

    The all-out approach has notched achievements. Successful chip design companies such as Cambricon and Huawei’s HiSilicon have allowed Huawei to replace some of its U.S.-designed chips in its mobile phones.

    Cambricon and HiSilicon are both fabless design houses, and both get their chips fabbed at foundries like TSMC. Huawei is one of the largest electronics companies in the world, with over $100 billion in annual sales, and they don’t own their own fab.

    Not far from Hongxin is Yangtze Memory Technologies Co. (YMTC), a partially state-owned company that plans to double its output of memory chips to overtake South Korea’s Samsung and SK Hynix, which currently dominate production.

    Memory is a tough business. SK Hynix exists because Hyundai and LG (aka Lucky Goldstar), two huge Korean chaebols who hate each other only slightly less than rival Samsung, found the sledding too tough to go alone and had to combine their respective semiconductor operations to survive. Memory makes money hand-over-fist in boom times, but barely breaks even during busts. It’s less technically demanding than some other semiconductor segments, so China could conceivably make some headway there.

    YMTC is a subsidiary of Tsinghua Unigroup, a wholly owned business unit of Tsinghua University. Hu Haifeng, Communist Party secretary of Tsinghua Holdings, is the son of Hu Jintao, former CCP General Secretary and President of the People’s Republic of China.

    Hongxin sought to capitalize on this momentum. It rented a discreet office on the 25th floor of Wuhan’s Dongxihu district government headquarters.

    “Cao” and his partners promised to pitch in 1.8 billion yuan ($276 million) in investment on top of 200 million yuan ($30.7 million) in starting funds from Dongxihu district.

    Wuhan’s city government was, around the same time, also beginning construction on a cybersecurity park to provide office and residential space for technology businesses, and it was looking for a flagship company to anchor the complex. In 2018 and 2019, the city named Hongxin its most important “critical construction project” and the company began building its factory next door.

    As early as late 2019, even while Hongxin was being lauded by Chinese media for securing an ASML machine, several Wuhan-based construction crews were scrambling to get paid for millions of dollars of work for Hongxin.

    “Four months ago, [Hongxin’s] payments to us started to be short, and now we are missing 18 million yuan [$2.76 million],” one contractor, Lu Haitao told another, Wang Liyun in December 2019, according to phone recordings NPR obtained. Wang confirmed the authenticity of the recordings when reached by phone. Lu did not respond to several texts and calls from NPR. Wuhan’s municipal government did not respond to a request for comment.

    Meanwhile, two other semiconductor companies — Tacoma Semiconductor Technology Co. Ltd. and Dehuai Semiconductor Technology Co. Ltd. — were also running out of cash.

    Tacoma was over 350 miles from Hongxin along the Yangtze river, in the port city of Nanjing. There, the Taiwanese entrepreneur Joseph Lee had initially found a welcome harbor for his own ambitions, starting Tacoma in the city in 2015. He pledged to raise $3 billion to make wafer chips, with consultation from Israeli company Tower Semiconductor (formerly TowerJazz). Tower declined to comment for this story.

    Lee continued pitching other local governments. In 2016, he co-founded a second company in Jiangsu province’s Huai’an city, named Dehuai Semiconductor. (Lee sold his stake the same year, citing a clash in vision with the firm’s other managers.)

    In 2017, Lee invited Chinese media to tour Tacoma’s facilities, declaring the company had somehow scored 200 million yuan ($30.7 million) in sales. Tacoma had yet to even finish construction on its manufacturing facilities.

    Lee initially agreed to an NPR interview for this story but later retracted it, citing state pressure. “Officials have told me not to talk to the media,” he said by text.

    Yeah, I bet.

    By 2018, Tacoma’s employees were blasting an online forum run by the Nanjing mayor’s office with complaints about unpaid salaries. Chinese corporate records show at least 50 legal complaints have been filed against Tacoma in provincial court, all seeking to recoup construction costs or unpaid wages. Lee disputes owing employees 20 million yuan in unpaid wages.

    “Real or fake, the truth is in the hearts of the people,” Lee wrote shortly after these allegations, on Wechat, the Chinese messaging app, and cited a verse from the New Testament: “Now faith is the certainty of things hoped for, a proof of things not seen.”

    Citing bible verse when rumbled for his scam. Classic.

    Hongxin, Tacoma and Dehuai were able to secure billions of yuan in state funding on the condition they would match that with investment of their own — a commitment that never materialized. Tacoma eventually raised only a fraction — 250 million out of 2.5 billion yuan — of what it promised.

    “We never imagined that when our cash flow dried up, we would not be able to find new [cash flow sources], that we would get in so deep,” he told Japanese broadcaster NHK this March.

    And this is the problem with doing business in China in general: it’s shell games all the way down. At lot of times, loans and investments are siphoned through four or five different entities from the purposes for which they were originally obtained. Everyone’s trying to get rich, and they hope to survive on smoke and mirrors long enough to get profitable. Imagine if Kleiner Perkins invested $25 million in a software startup, only to find that money was spent on a noodle shop, a used car dealership and a golf club manufacturer.

    Sometimes it works. You can build a company on margin, get profitable quickly, and be paying off investors and contractors before anyone realizes how shaky the entire enterprise is.

    But you can’t do that with semiconductor manufacturing. The startup costs are simply too high, easily in the billions. Very, very few companies can afford to be in a game that expensive. China’s two biggest semiconductor manufacturing success stories, SMIC and Tsinghua Unigroup, all have have CCP direct government investment.

    In this game, little hucksters working the margins have no chance.

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    A Good Explanation of the Semiconductor Shortage

    Tuesday, April 6th, 2021

    A semiconductor shortage has been plaguing the automobile industry for several months, and this piece explains why:

    To understand why the $450 billion semiconductor industry has lurched into crisis, a helpful place to start is a one-dollar part called a display driver.

    Correction: The semiconductor industry itself isn’t in crisis, it’s making money hand-over-fist right now. It’s certain industries relying on semiconductors that have the problem.

    Hundreds of different kinds of chips make up the global silicon industry, with the flashiest ones from Qualcomm Inc. and Intel Corp. going for $100 apiece to more than $1,000. Those run powerful computers or the shiny smartphone in your pocket. A display driver is mundane by contrast: Its sole purpose is to convey basic instructions for illuminating the screen on your phone, monitor or navigation system.

    The trouble for the chip industry — and increasingly companies beyond tech, like automakers — is that there aren’t enough display drivers to go around. Firms that make them can’t keep up with surging demand so prices are spiking. That’s contributing to short supplies and increasing costs for liquid crystal display panels, essential components for making televisions and laptops, as well as cars, airplanes and high-end refrigerators.

    “It’s not like you can just make do. If you have everything else, but you don’t have a display driver, then you can’t build your product,” says Stacy Rasgon, who covers the semiconductor industry for Sanford C. Bernstein.

    Now the crunch in a handful of such seemingly insignificant parts — power management chips are also in short supply, for example — is cascading through the global economy. Automakers like Ford Motor Co., Nissan Motor Co. and Volkswagen AG have already scaled back production, leading to estimates for more than $60 billion in lost revenue for the industry this year.

    A bit of background here: Back in the dim mists of time, some major car manufacturers used to have their own captive wafer fabrication plants for automotive components. They were more art-of-the-state than state-of-the-art, as well as heavily unionized. (Your etch machine broke? Better figure out whether you need the union plumber or the union electrician to fix it…) GM shut down their last semiconductor plan in Kokomo, Indiana (which I think was running a 500 nanomemter process, which was beyond old even then) in 2017.

    The situation is likely to get worse before it gets better. A rare winter storm in Texas knocked out swaths of U.S. production. A fire at a key Japan factory will shut the facility for a month. Samsung Electronics Co. warned of a “serious imbalance” in the industry, while Taiwan Semiconductor Manufacturing Co. said it can’t keep up with demand despite running factories at more than 100% of capacity.

    “I have never seen anything like this in the past 20 years since our company’s founding,” said Jordan Wu, co-founder and chief executive officer of Himax Technologies Co., a leading supplier of display drivers. “Every application is short of chips.”

    The chip crunch was born out of an understandable miscalculation as the coronavirus pandemic hit last year. When Covid-19 began spreading from China to the rest of the world, many companies anticipated people would cut back as times got tough.

    “I slashed all my projections. I was using the financial crisis as the model,” says Rasgon. “But demand was just really resilient.”

    People stuck at home started buying technology — and then kept buying. They purchased better computers and bigger displays so they could work remotely. They got their kids new laptops for distance learning. They scooped up 4K televisions, game consoles, milk frothers, air fryers and immersion blenders to make life under quarantine more palatable. The pandemic turned into an extended Black Friday onlinepalooza.

    Automakers were blindsided. They shut factories during the lockdown while demand crashed because no one could get to showrooms. They told suppliers to stop shipping components, including the chips that are increasingly essential for cars.

    Then late last year, demand began to pick up. People wanted to get out and they didn’t want to use public transportation. Automakers reopened factories and went hat in hand to chipmakers like TSMC and Samsung. Their response? Back of the line. They couldn’t make chips fast enough for their still-loyal customers.

    Here’s the crux of the problem:

    Wu explained that he can’t make more display drivers by pushing his workforce harder. Himax designs display drivers and then has them manufactured at a foundry like TSMC or United Microelectronics Corp. His chips are made on what’s artfully called “mature node” technology, equipment at least a couple generations behind the cutting-edge processes. These machines etch lines in silicon at a width of 16 nanometers or more, compared with 5 nanometers for high-end chips.​

    ​The bottleneck is that these mature chip-making lines are running flat out. Wu says the pandemic drove such strong demand that manufacturing partners can’t make enough display drivers for all the panels that go into computers, televisions and game consoles — plus all the new products that companies are putting screens into, like refrigerators, smart thermometers and car-entertainment systems.

    There’s been a particular squeeze in driver ICs for automotive systems because they’re usually made on 8-inch silicon wafers, rather than more advanced 12-inch wafers. Sumco Corp., one of the leading wafer manufacturers, reported production capacity for 8-inch equipment lines was about 5,000 wafers a month in 2020 — less than it was in 2017.

    Hell, there are people still running some four inch fab lines out there, though usually it’s for something funky like gallium arsenide, old analog signal processes, etc.

    The problem is, no one is building any new capacity in those old geometries because fabs are too expensive to build and need 2-3 years of lead time to get up and running. Moore’s second law states that the cost of a new, cutting edge semiconductor plant doubles every four years. You can’t just take an existing building and turn it into a fab, it has to be specially built from the ground up with exacting standards for cleanroom air filtering, concrete slab level uniformity, etc. And equipment manufacturers like Applied Materials and LAM Research aren’t going to sell you old technology machines to build older geometry chips because they’re not making them anymore. And if you have to pay full price for the equipment, you might as well fab higher-value chips in current geometries anyway.

    TSMC is already spending $100 billion for expanded manufacturing capacity over the next three years, and Intel another $20 billion. That spiraling fab cost is why so many former integrated device manufacturers went to a fabless model, designing chips but letting the manufacturing be handled by foundries like TSMC, UMC and Global Foundries. (And Intel is expanding their own foundry business at the same time they’re paying TSMC to fab some of their top-end chips. You can’t tell the players without a scorecard…)

    The other problem is the extremely cyclical nature of the semiconductor industry. In booms, fabs make money hand over fist. During busts, some segments (like RAM) barely break even. The foundry model has smoothed the spikes out somewhat, but as the current shortage shows, not entirely.

    Just-In-Time delivery was one of the great disruptive business innovations. Leaner, more tightly-coupled computerized inventory lead to decreases in unused parts and faster times to market. But when there’s a hiccup in the supply chain, it makes it more immediately disruptive. It’s hard to obtain additional semiconductor parts if everyone’s fab is already at full capacity, so expect shortages to extend into the year.

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    China Invades Taiwan: Two Scenarios

    Saturday, October 10th, 2020

    Two different pieces have come out recently, painting competing pictures of what a Chinese attempt to conquer Taiwan would look like. First up, this Samson Ellis piece for Bloomberg:

    Beijing’s optimistic version of events goes something like this: Prior to an invasion, cyber and electronic warfare units would target Taiwan’s financial system and key infrastructure, as well as U.S. satellites to reduce notice of impending ballistic missiles. Chinese vessels could also harass ships around Taiwan, restricting vital supplies of fuel and food.

    Airstrikes would quickly aim to kill Taiwan’s top political and military leaders, while also immobilizing local defenses. The Chinese military has described some drills as “decapitation” exercises, and satellite imagery shows its training grounds include full-scale replicas of targets such as the Presidential Office Building.

    An invasion would follow, with PLA warships and submarines traversing some 130 kilometers (80 miles) across the Taiwan Strait. Outlying islands such as Kinmen and Pratas could be quickly subsumed before a fight for the Penghu archipelago, which sits just 50 kilometers from Taiwan and is home to bases for all three branches of its military. A PLA win here would provide it with a valuable staging point for a broader attack.

    As Chinese ships speed across the strait, thousands of paratroopers would appear above Taiwan’s coastlines, looking to penetrate defenses, capture strategic buildings and establish beachheads through which the PLA could bring in tens of thousands of soldiers who would secure a decisive victory.

    In reality, any invasion is likely to be much riskier. Taiwan has prepared for one for decades, even if lately it has struggled to match China’s growing military advantage.

    Taiwan’s main island has natural defenses: Surrounded by rough seas with unpredictable weather, its rugged coastline offers few places with a wide beach suitable for a large ship that could bring in enough troops to subdue its 24 million people. The mountainous terrain is riddled with tunnels designed to keep key leaders alive, and could provide cover for insurgents if China established control.

    Taiwan in 2018 unveiled a plan to boost asymmetric capabilities like mobile missile systems that could avoid detection, making it unlikely Beijing could quickly destroy all of its defensive weaponry. With thousands of surface-to-air missiles and anti-aircraft guns, Taiwan could inflict heavy losses on the Chinese invasion force before it reached the main island.

    Taiwan’s military has fortified defenses around key landing points and regularly conducts drills to repel Chinese forces arriving by sea and from the air. In July outside of the western port of Taichung, Apache helicopters, F-16s and Taiwan’s own domestically developed fighter jets sent plumes of seawater into the sky as they fired offshore while M60 tanks, artillery guns and missile batteries pummeled targets on the beach.

    Chinese troops who make it ashore would face roughly 175,000 full-time soldiers and more than 1 million reservists ready to resist an occupation. Taiwan this week announced it would set up a defense mobilization agency to ensure they were better prepared for combat, the Taipei Times reported.

    Doesn’t sound like a cakewalk, does it?
    
    This Tanner Greer piece in Foreign Policy like Beijing’s chances even less:

    When Chinese President Xi Jinping spoke to the 19th Party Congress about the future of Taiwan last year, his message was ominous and unequivocal: “We have firm will, full confidence, and sufficient capability to defeat any form of Taiwan independence secession plot. We will never allow any person, any organization, or any political party to split any part of the Chinese territory from China at any time or in any form.”

    This remark drew the longest applause of his entire three-hour speech—but it’s not a new message. The invincibility of Chinese arms in the face of Taiwanese “separatists” and the inevitability of reunification are constant Chinese Communist Party themes. At its base, the threat made by Xi is that the People’s Liberation Army has the power to defeat the Taiwanese military and destroy its democracy by force, if need be. Xi understands the consequences of failure here. “We have the determination, the ability and the preparedness to deal with Taiwanese independence,” he stated in 2016, “and if we do not deal with it, we will be overthrown.”

    Snip.

    Two recent studies, one by Michael Beckley, a political scientist at Tufts University, and the other by Ian Easton, a fellow at the Project 2049 Institute, in his book The Chinese Invasion Threat: Taiwan’s Defense and American Strategy in Asia, provide us with a clearer picture of what a war between Taiwan and the mainland might look like. Grounded in statistics, training manuals, and planning documents from the PLA itself, and informed by simulations and studies conducted by both the U.S. Defense Department and the Taiwanese Ministry of National Defense, this research presents a very different picture of a cross-strait conflict than that hawked by the party’s official announcements.

    Chinese commanders fear they may be forced into armed contest with an enemy that is better trained, better motivated, and better prepared for the rigors of warfare than troops the PLA could throw against them. A cross-strait war looks far less like an inevitable victory for China than it does a staggeringly risky gamble.

    Chinese army documents imagine that this gamble will begin with missiles. For months, the PLA’s Rocket Force will have been preparing this opening salvo; from the second war begins until the day the invasion commences, these missiles will scream toward the Taiwanese coast, with airfields, communication hubs, radar equipment, transportation nodes, and government offices in their sights. Concurrently, party sleeper agents or special forces discreetly ferried across the strait will begin an assassination campaign targeting the president and her Cabinet, other leaders of the Democratic Progressive Party, officials at key bureaucracies, prominent media personalities, important scientists or engineers, and their families.

    The goal of all this is twofold. In the narrower tactical sense, the PLA hopes to destroy as much of the Taiwanese Air Force on the ground as it can and from that point forward keep things chaotic enough on the ground that the Taiwan’s Air Force cannot sortie fast enough to challenge China’s control of the air. The missile campaign’s second aim is simpler: paralysis. With the president dead, leadership mute, communications down, and transportation impossible, the Taiwanese forces will be left rudderless, demoralized, and disoriented. This “shock and awe” campaign will pave the way for the invasion proper.

    This invasion will be the largest amphibious operation in human history. Tens of thousands of vessels will be assembled—mostly commandeered from the Chinese merchant marine—to ferry 1 million Chinese troops across the strait, who will arrive in two waves. Their landing will be preceded by a fury of missiles and rockets, launched from the Rocket Force units in Fujian, Chinese Air Force fighter bombers flying in the strait, and the escort fleet itself.

    Confused, cut off, and overwhelmed, the Taiwanese forces who have survived thus far will soon run out of supplies and be forced to abandon the beaches. Once the beachhead is secured, the process will begin again: With full air superiority, the PLA will have the pick of their targets, Taiwanese command and control will be destroyed, and isolated Taiwanese units will be swept aside by the Chinese army’s advance. Within a week, they will have marched into Taipei; within two weeks they will have implemented a draconian martial law intended to convert the island into the pliant forward operating base the PLA will need to defend against the anticipated Japanese and American counter-campaigns.

    This is the best-case scenario for the PLA. But an island docile and defeated two weeks after D-Day is not a guaranteed outcome. One of the central hurdles facing the offensive is surprise. The PLA simply will not have it. The invasion will happen in April or October. Because of the challenges posed by the strait’s weather, a transport fleet can only make it across the strait in one of these two four-week windows. The scale of the invasion will be so large that strategic surprise will not be possible, especially given the extensive mutual penetration of each side by the other’s intelligence agencies.

    Easton estimates that Taiwanese, American, and Japanese leaders will know that the PLA is preparing for a cross-strait war more than 60 days before hostilities begin. They will know for certain that an invasion will happen more than 30 days before the first missiles are fired. This will give the Taiwanese ample time to move much of their command and control infrastructure into hardened mountain tunnels, move their fleet out of vulnerable ports, detain suspected agents and intelligence operatives, litter the ocean with sea mines, disperse and camouflage army units across the country, put the economy on war footing, and distribute weapons to Taiwan’s 2.5 million reservists.

    There are only 13 beaches on Taiwan’s western coast that the PLA could possibly land at. Each of these has already been prepared for a potential conflict. Long underground tunnels—complete with hardened, subterranean supply depots—crisscross the landing sites. The berm of each beach has been covered with razor-leaf plants. Chemical treatment plants are common in many beach towns—meaning that invaders must prepare for the clouds of toxic gas any indiscriminate saturation bombing on their part will release. This is how things stand in times of peace.

    As war approaches, each beach will be turned into a workshop of horrors. The path from these beaches to the capital has been painstakingly mapped; once a state of emergency has been declared, each step of the journey will be complicated or booby-trapped. PLA war manuals warn soldiers that skyscrapers and rock outcrops will have steel cords strung between them to entangle helicopters; tunnels, bridges, and overpasses will be rigged with munitions (to be destroyed only at the last possible moment); and building after building in Taiwan’s dense urban core will be transformed into small redoubts meant to drag Chinese units into drawn-out fights over each city street.

    Interesting analysis of a PLA grunt’s disillusioning journey toward war snipped.

    But by the time he reaches the staging area in Fuzhou, the myth of China’s invincibility has been shattered by more than rumors. The gray ruins of Fuzhou’s PLA offices are his first introduction to the terror of missile attack. Perhaps he takes comfort in the fact that the salvos coming from Taiwan do not seem to match the number of salvos streaking toward it—but abstractions like this can only do so much to shore up broken nerves, and he doesn’t have the time to acclimate himself to the shock. Blast by terrifying blast, his confidence that the Chinese army can keep him safe is chipped away.

    The last, most terrible salvo comes as he embarks—he is one of the lucky few setting foot on a proper amphibious assault boat, not a civilian vessel converted to war use in the eleventh hour—but this is only the first of many horrors on the waters. Some transports are sunk by Taiwanese torpedoes, released by submarines held in reserve for this day. Airborne Harpoon missiles, fired by F-16s leaving the safety of cavernous, nuclear-proof mountain bunkers for the first time in the war, will destroy others. The greatest casualties, however, will be caused by sea mines. Minefield after minefield must be crossed by every ship in the flotilla, some a harrowing eight miles in width. Seasick thanks to the strait’s rough waves, our grunt can do nothing but pray his ship safely makes it across.

    As he approaches land, the psychological pressure increases. The first craft to cross the shore will be met, as Easton’s research shows, with a sudden wall of flame springing up from the water from the miles of oil-filled pipeline sunk underneath. As his ship makes it through the fire (he is lucky; others around it are speared or entangled on sea traps) he faces what Easton describes as a mile’s worth of “razor wire nets, hook boards, skin-peeling planks, barbed wire fences, wire obstacles, spike strips, landmines, anti-tank barrier walls, anti-tank obstacles … bamboo spikes, felled trees, truck shipping containers, and junkyard cars.”

    At this stage, his safety depends largely on whether the Chinese Air Force has been able to able to distinguish between real artillery pieces from the hundreds of decoy targets and dummy equipment PLA manuals believe the Taiwanese Army has created. The odds are against him: As Beckley notes in a study published last fall, in the 1990 to 1991 Gulf War, the 88,500 tons of ordnance dropped by the U.S.-led coalition did not destroy a single Iraqi road-mobile missile launcher. NATO’s 78-day campaign aimed at Serbian air defenses only managed to destroy three of Serbia’s 22 mobile-missile batteries. There is no reason to think that the Chinese Air Force will have a higher success rate when targeting Taiwan’s mobile artillery and missile defense.

    But if our grunt survives the initial barrages on the beach, he still must fight his way through the main Taiwanese Army groups, 2.5 million armed reservists dispersed in the dense cities and jungles of Taiwan, and miles of mines, booby traps, and debris. This is an enormous thing to ask of a private who has no personal experience with war. It is an even great thing to ask it of a private who naively believed in his own army’s invincibility.

    They know war would be a terrific gamble, even if they only admit it to each other. Yet it this also makes sense of the party’s violent reactions to even the smallest of arms sales to Taiwan. Their passion betrays their angst. They understand what Western gloom-and-doomsters do not. American analysts use terms like “mature precision-strike regime” and “anti-access and area denial warfare” to describe technological trends that make it extremely difficult to project naval and airpower near enemy shores. Costs favor the defense: It is much cheaper to build a ship-killing missile than it is to build a ship.

    But if this means that the Chinese army can counter U.S. force projection at a fraction of America’s costs, it also means that the democracies straddling the East Asian rim can deter Chinese aggression at a fraction of the PLA’s costs. In an era that favors defense, small nations like Taiwan do not need a PLA-sized military budget to keep the Chinese at bay.

    My feeling is that Greer’s analysis is probably more correct, though not to the extent that the United States or Taiwan can rely on it to guarantee victory over a Chinese invasion.

    A few further thoughts:

  • One reason defending Taiwan is so vital is that TSMC is the most important semiconductor foundry in the world. Apple, AMD, Nvidia, Qualcomm, Broadcom and even Intel get their cutting-edge chips fabbed there, as does Huawei. Losing that would be a huge blow to the free world’s technological dominance, and a good 12-18 months of supply disruption at a minimum. TSMC’s announced Arizona fab won’t even start construction until next year, and won’t come online for production until 2024.
  • I am very far indeed from an expert on the weather in the Taiwanese straits, but I don’t think we can assume that the PLA won’t try an attack other times of the year if they think they can maintain the element of surprise, even if it means significant personnel loses due to inclement weather. Communist military doctrine has always been indifferent to high personnel loses if it means achieving important objectives. But achieving surprise for an amphibious invasion of this size is almost impossible.
  • The point about the leathality of modern precision munitions is well taken. As modern Marine Corps doctrine states: “To be detected is to be targeted is to be killed.” Amphibious invasions are extremely difficult things to pull off under the best of circumstances, and China will not be operating under the best of circumstances.
  • The precariousness of the situation is why U.S. arms sales to Taiwan for things like M1A2 tanks and Stinger missiles are so important. And we should also sell Taiwan F-35s. China may make noise about their miltech being equal to or better than our own, but ours is the gold standard for the rest of the world.

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    Posted in Communism, Foreign Policy, Military | 18 Comments »

    Nvidia Surpasses Intel In Market Cap

    Tuesday, July 28th, 2020

    This is some crazy news:

    Nvidia Corp. NVDA, 2.38% surpassed Intel Corp. INTC, -1.38% as the largest U.S. chip maker by market cap for the first time on Wednesday. Nvidia shares closed up 3.5% at $408.64, giving it a market cap of $251.31 billion, while Intel shares finished up 0.5% at $58.61, giving it a market cap of $248.16 billion, according to FactSet data. For the year, Nvidia shares have gained 74% while Intel shares have slipped 2%, compared with a 11% gain in the PHLX Semiconductor Index SOX, 3.14%, a 17% gain in the tech-heavy Nasdaq Composite Index COMP, 1.64%, and a 1.9% decline in the S&P 500 index SPX, 0.66%. While it is not the first time a U.S. chip maker has surpassed Intel in market cap, it is the first time for Nvidia. Back in 1999 and 2000, Texas Instruments Inc. TXN, 1.89% surpassed Intel in cap a few times, and between late 2012 and mid-2014 Qualcomm Inc. QCOM, 3.80% and Intel often jockeyed for the No. 1 position, according to Dow Jones data.

    Nvidia is a fabless semiconductor company that designs graphics processor units (GPUs), the chips that drive computer screens, especially those for gaming systems and consoles. They were also popular for Bitcoin and other crypto-currency mining rigs, though that market seems to have played itself out. They earned just over $3 billion in profit in their fiscal Q1.

    Intel, of course, makes CPUs, the central processing units at the heart of pretty much every computer. They’ve had trouble recently as rival AMD has lapped them in a number of markets, Apple is abandoning them as the Mac CPU manufacturer to go with a custom ARM-based system-on-a-chip, and reportedly Intel has had process yield problems with their chips. However all of that hasn’t prevented them from announcing over $5 billion in profits for their last fiscal quarter, though they also announced they’re pushing out their 7mm process node.

    Nvidia, like AMD, has its chips fabbed by TSMC. (AMD is also a competitor to Nvidia in the GPU space, having bought GPU maker ATI back in 2006.) Intel has more than a dozen of it’s own own wafer fabrication plants. But there are reports that even Intel has contracted with TSMC to fab some of its chips next year.

    As of this writing, Nvidia is trading at a share price of about 78 times earnings. Meanwhile, Intel is trading at about nine times earnings. That’s a crazy divergence.

    Owning your own fabs has become a very expensive proposition, but once they’re up and running, the costs are lower and give you full control of the process. So far Nvidia has benefited greatly from having TSMC fab their chips, but it’s rumored that all of TSMC’s cutting edge 5nm fab wafer starts are already spoken for next year (Apple is another customer), and it will take time for more fab capacity to come online. That may start to constrain Nvidia’s growth.

    Nvidia is certainly having a better year than Intel, but 80 times earnings is a pretty crazy P/E ratio. Some market correction is probably in order.

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    Posted in Economics, Uncategorized | 2 Comments »

    Apple Dumps Intel

    Wednesday, June 24th, 2020

    Apple just announced that its Macintosh PC line will be moving from Intel CPUs to its own chip designs.

    Apple today announced it will transition the Mac to its world-class custom silicon to deliver industry-leading performance and powerful new technologies. Developers can now get started updating their apps to take advantage of the advanced capabilities of Apple silicon in the Mac. This transition will also establish a common architecture across all Apple products, making it far easier for developers to write and optimize their apps for the entire ecosystem.

    Apple today also introduced macOS Big Sur, the next major release of macOS, which delivers its biggest update in more than a decade and includes technologies that will ensure a smooth and seamless transition to Apple silicon. Developers can easily convert their existing apps to run on Apple silicon, taking advantage of its powerful technologies and performance. And for the first time, developers can make their iOS and iPadOS apps available on the Mac without any modifications.

    To help developers get started with Apple silicon, Apple is also launching the Universal App Quick Start Program, which provides access to documentation, forums support, beta versions of macOS Big Sur and Xcode 12, and the limited use of a Developer Transition Kit (DTK), a Mac development system based on Apple’s A12Z Bionic System on a Chip (SoC).

    Apple plans to ship the first Mac with Apple silicon by the end of the year and complete the transition in about two years. Apple will continue to support and release new versions of macOS for Intel-based Macs for years to come, and has exciting new Intel-based Macs in development. The transition to Apple silicon represents the biggest leap ever for the Mac.

    Well, not really. The leaps from Motorola’s 68000 series to PowerPC chips, its move from legacy Mac OS to the FreeBSD/NeXTSTEP-based OS X, and the transition away from PowerPC to Intel, were all probably bigger leaps. But their transition away from Intel is still pretty big.

    The chip they’re moving doing is based on ARM, but that’s only a small part of the story:

    The A12Z chip that Apple is currently using in its latest LiDAR iPad Pro and its first generation Apple Silicon chip in the Mac mini developer transition kit does incorporate ARM CPU cores. But that ARM Architecture CPU is not the most significant reason Apple is moving away from Intel’s chips on Macs.

    Apple alluded to this in referring to its own custom silicon as being an “SoC,” or System on a Chip. Over the past decade, Apple has developed a series of SoCs that incorporate essentially an entire logic board of chips that a typical PC would require into a single chip that can be mass produced and used across multiple devices from its iPhone, to iPad, to Apple TV and even HomePod.

    The primary advantage of this integration was power consumption. ARM supplied licensed CPU reference design cores that provided leading compute performance per watt, leading Apple to make ARM the center core of its SoC designs. ARM cores are also the basis for Apple’s M-series components that monitor data from the accelerometer, gyroscope, and barometer to efficiently track how a device is moving over time.

    Snip.

    In some respects, Apple’s use of ARM cores in its SoCs is similar to its use of Unix in the OS itself. Both are effectively specifications that standardize the operations of low level technology layers. In the same way that Macs are more than just Unix systems, Apple’s SoCs are more than just ARM processors.

    As with Qualcomm’s modems, the customizations, optimizations, and additional layers of proprietary work that Apple adds to its A-series SoCs results in a package that’s significantly more valuable than its base components.

    That reality is reflected in Apple’s custom silicon being a lot more than just an “ARM chip,” and helps to explain why Apple’s SoCs have increasingly outperformed other ARM-based SoCs developed by Qualcomm, Nvidia, Samsung, and others.

    Who’s going to fab the chips? Almost certainly TSMC, which has been fabbing iPhone chips since 2014, and which has lapped Intel in process technology.

    Could Apple build their own fab? With a market cap of over 1.5 trillion and $192.8 billion cash on hand, they’re one of the few companies that could without making it a “bet your company” proposition.

    But I don’t think they will.

    Keep in mind, TSMC just broke ground on a new 5nm, 300mm Taiwanese fab expected to cost NT$500 billion, which works out to some $16.9 billion. They also plan to build a another 5nm fab in Arizona for $12 billion. That’s a lot of capacity for Apple (one of TSMC’s biggest customers, if not the biggest) to take advantage of. (TSMC has dozens of existing fabs, but not all are equipped for the cutting edge process technology Apple needs.)

    Actually, Apple already owns a fab, a former Maxim facility at 3725 N. First St. San Jose, California, which it bought in 2015. Weirdly enough, you can’t find any information about it after 2015. Could they retrofit it to make their new SoCs? The older a fab is, the less likely it is to get retrofitted for new technology, for a variety of reasons. If they weren’t already using it for CPU production, they probably wouldn’t start now. But since they only paid $18.2 million for 70,000 square feet of valuable Silicon Valley real estate, I doubt that concerns them much.

    Fabbing their own CPUs has a long-rumored move on Apple’s part, which has been building up its chip design capabilities for over a decade with the acquisitions of fabless design companies like P.A. Semi, Intrinsity, Anobit, Passif Semiconductor and part of Dialog Semiconductor. With its own CPUs, Apple is finally getting the complete end-to-end control of its computing platform its long sought.

    According to Apple, “With the translation technology of Rosetta 2, users will be able to run existing Mac apps that have not yet been updated, including those with plug-ins. Virtualization technology allows users to run Linux. Developers can also make their iOS and iPadOS apps available on the Mac without any modifications.” Apple’s previous emulation transitions worked pretty well, but were far from seamless. In theory, well-written Mac software should only require a recompile to work properly on Macs using Apple’s new chips. In practice, such transitions are always bumpy, and it will take a while to tune performance.

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    Posted in Economics, Uncategorized | 2 Comments »

    LinkSwarm for May 15, 2020

    Friday, May 15th, 2020

    Greetings, and welcome to another Friday LinkSwarm! Today’s theme is Democratic Governor’s ignoring the constitution to keep their precious lockdowns going, Obamagate, spying (domestic and foreign), a bit about aircraft, and funny animals. Dig in!

  • The economy: is the worst over? Let’s hope.
  • Remember how Georgia lifting the lockdown and opening the economy was going to kill everyone’s granny? Yeah, not so much: “Georgia Records Lowest Number of Coronavirus Patients in over a Month.”
  • More medical hope:

    Ever since President Trump expressed optimism about the use of hydroxychloroquine to treat COVID-19, the mere mention of that drug can elicit instantaneous, strident, and finger-wagging condemnation by the mainstream media and all those who are pulling for the pandemic to lay waste to the economy and pave the way for a fundamental progressive transformation of America. Despite its use by health-care providers across the country and around the world to successfully treat COVID-19, you will be mocked as either a fool or a snake oil salesman if you approvingly utter the word “hydroxychloroquine” or even express hope that it can be used to save lives. The word is simply not to be tolerated in polite, progressive society.

    Well, it appears that the list of forbidden words is about to get longer. The new additions include “corticosteroids” and “Methylprednisolone.”

    What do these widely available and relatively inexpensive drugs with known safety profiles have in common with hydroxychloroquine? Leading physicians are using them in addition to hydroxychloroquine to successfully treat COVID-19. And they are doing so without waiting two or three years for the results of randomized clinical trials.

    (Hat tip: Ace of Spades HQ.)

  • “Wuhan Virus Watch: Over Half of All U.S. Deaths Have Occurred in Just Five States.” “New York, New Jersey, Massachusetts, Michigan and Pennsylvania. New York remains the hardest-hit state of any in the country by far, having logged nearly 27,000 deaths as of Saturday afternoon. The next-hardest-hit state, New Jersey, had recorded over 9,100.”
  • Speaking of Michigan:

    It is difficult to describe, and impossible to exaggerate, just how badly Michigan Gov. Gretchen Whitmer’s COVID-19 response has been, and it has been a catastrophe from the very beginning. In early March, when the country was already becoming concerned about the spread of the virus, Whitmer did not cancel the Democratic presidential primary, and indeed, there was record turnout for the March 10 primary, which turned into a “super spreader” event in metropolitan Detroit. She has since bungled practically every aspect of the pandemic, including her deliberately punitive and irrational lockdown policy. Now she would have us believe that she is the real victim of all this:

    Michigan Gov. Gretchen Whitmer (D) said Wednesday that the lockdown protests are “racist and misogynistic” and called on those with a platform to discourage the demonstrators.

    Whitmer told ABC’s “The View” that the protests are “really political” as demonstrators have brought nooses, Confederate flags and Nazi symbolism.

    “This is not appropriate in a global pandemic,” she said. “But it’s certainly not an exercise of democratic principles where we have free speech. This is calls to violence. This is racist and misogynistic.”

    I have no idea who brought nooses, etc., to these protests, although I suspect these were false-flag agents provocateurs — leftists pretending to be part of the protest and acting in ways intended to discredit Whitmer’s opponents. None of this, however, justifies her policies.

  • Just in case you thought there was an end to her awful policies: “Michigan state Rep. Leslie Love (D-Detroit) is blasting Gov. Gretchen Whitmer’s (D) policy of returning coronavirus patients to nursing homes, making the Detroit lawmaker the second Democrat to criticize the governor publicly in less than a month.”
  • Speaking of which: “NY officials allowed COVID-positive workers to stay on the job at nursing homes — the facilities account for 25% of deaths in the state.” More of that brilliant one-party Democratic rule…
  • “Media Lies: Democrat Governors Doing Great Jobs Despite Higher Wuhan Death Rates.”
  • Continuing the theme (click to expand image):

  • Wisconsin Governor and bureaucracy: “Screw your rights. Stay at home.” Wisconsin Supreme Court: “Unconstitutional.” Wisconsin Governor and bureaucracy the very same day: “Oh yeah? Then screw your religion! No meetings for you God weirdos!” Every. Knee. Must. Bend.
  • That crap doesn’t fly in Texas:

    Dallas County Commissioner Judge Clay Jenkins has repeatedly tried to act as the ruler of Dallas County by attempting to force his will on everyone within it and each time he’s been put back in his place by everyone from the citizens of Dallas County to his own fellow commissioners.

    Jenkins has now awakened the wrath of Texas Attorney General Ken Paxton who issued a warning to him and other officials in other Texas counties who are trying to illegally prevent Texans from living doing things such as attending church.

    According to Paxton’s office, a warning was issued to three county judges and two mayors telling them to back off their make-believe thrones, or else there will be consequences:

    Attorney General Ken Paxton today issued letters to three Texas counties (Dallas, Bexar, and Travis) and two mayors (San Antonio and Austin), warning that some requirements in their local public health orders are unlawful and can confuse law-abiding citizens. These unlawful and unenforceable requirements include strict and unconstitutional demands for houses of worship, unnecessary and onerous restrictions on allowing essential services to operate, such as tracking customers who visit certain restaurants, penalties for not wearing masks, shelter-in-place demands, criminal penalties for violating state or local health orders, and failing to differentiate between recommendations and mandates.

  • The curve Democrats really want to flatten:

  • The government-imposed lockdown needs to end. But lot’s of people have (properly) set their own lockdown standards:

    Many of the most important mitigation strategies are unknown to the general public because they’ve taken place behind closed doors on the initiative of employers, not bureaucrats, and have little or nothing to do with legal mandates (which are themselves, as I can attest is the case here in Canada, a contradictory, hastily-conceived patchwork of federal and provincial directives and advisories). To give but one example I happen to be familiar with: Many of the men and women you see driving delivery trucks and construction vehicles are now governed by all sorts of rules, at pickup and drop-off, that allow them to perform their functions without coming within six feet of others. In some cases, they’ve been enabled with apps on their phones or dash-mounted tablets that permit them to coordinate these functions without any direct on-site human interaction whatsoever. Or they might be subject to thermometer-gun screenings to determine if they have a fever. Having implemented these lockdown-lite policies at great cost and inconvenience, employers aren’t going to dump them the moment the government gives them permission to do so, even though these procedures have increased costs and decreased output.

    Many employers I speak to are actually far more constricted by the concerns of their own employees than by the law itself. At one workplace that I know of, the boss announced that loosened provincial restrictions mean that everyone can come back to work this month. To his surprise, his employees announced that they’d voted on the issue through Facebook, and, no, they would not be coming back, at least not yet. And in Quebec, which is starting to let elementary-school students come back to class this month, thousands of parents—a majority at some schools—have decided to keep their children home. I am told by reliable sources within my own family that some of these parents are even pressuring their neighbours to do likewise, and are shaming dissenters on social media as bad parents. It’s lockdown by mob.

    To some extent, I find this attitude of populist hyper-vigilance to be exasperating, because sending your young kids to school is now generally safe (and, selfishly, because I think my own seven-year-old could benefit from getting back to a structured education environment). But we got into this mess by letting our guard down, and so it’s not surprising that many ordinary people want to err on the other side of the equation for a month or three. Whatever your views, though, if you’re all in a fuss about lockdown policy, please remember that the real lockdown was never imposed by government. It turns out that it was inside each and every one of us all along.

  • Devin Nunes thinks that the entire Trump transition team was under surveillance by the Obama Administration. (Hat tip: Director Blue.)
  • Don Surber asked a question back in 2017 that we ought to take a fresh look at: Was Obama using the NSA to spy on Romney during the 2012 election? Given what we know of Crossfire Hurricane, would anyone put it past him?
  • Related:

  • Russia, Russia, Russia!

  • Oh, lovely. Crowdstrike admits that there was no evidence that Russia hacked the DNC server.
  • Lives better for the living:

  • Mexico’s president Andres Manuel Lopez Obrador would like to know the truth behind Obama’s Fast and Furious illegal gun running program. A lot of us would like to know the same thing…
  • EU and German courts (strangely two different things in this story) are having a pissing match over whose gavel is bigger.
  • Canadian Broadcasting Company can’t decide just how it wants to lie about The Epoch Times and its reporting on the Chinese Communist Party’s culpability in the Wuhan Coronavirus. (Hat tip: Ed Driscoll at Instapundit.)
  • TSMC to build chip foundry in Arizona. This is a pretty big deal, as TSMC currently has the best fab tech in the world, and this will be their first ground-up American foundry (they currently have (I think) two other American fabs as the result of acquisitions from WaferTech and TI).
  • “Arkansas Professor Arrested For Concealing Communist Chinese Funding.”

    An engineering professor at the University of Arkansas has been arrested by the FBI and faces up to 20 years in prison for allegedly hiding funding that he received from the communist Chinese government.

    The New York Times reports that “Simon Ang of the University of Arkansas, was arrested on Friday and charged on Monday with wire fraud.”

    “He worked for and received funding from Chinese companies and from the Thousand Talents program, which awards grants to scientists to encourage relationships with the Chinese government,” the report notes, adding that “he warned an associate to keep his affiliation with the program quiet.”

    The report explains that Ang’s alleged hiding of the funding enabled him to also get US government subsidies, specifically from NASA, to the tune of more than $5 million.

  • “Chinese Government Lays Off Entire Propaganda Team As American Media Doing Their Job For Them.
  • “CNN Replaces President Trump’s Press Briefings With President Xi’s.”
  • Capitalist fungus. (Hat tip: Ann Althouse.)
  • “Billy doesn’t respond well to pressure.”
  • “Why we at $FAMOUS_COMPANY Switched to $HYPED_TECHNOLOGY.”
  • Important safety tip: Don’t stand on an active airport runway. This was Austin, so odds are it was an adler.
  • For Rich:

  • The Los Angeles Rams uniforms are horrible garbage.
  • “Democratic States Deploy Greta Thunberg Drones To Lecture People Who Go Outside.”
  • Water sausage eats breakfast:

  • Goat rodeo:

  • This dog is on my wavelength:

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    Posted in Austin, Democrats, Economics, Media Watch, Obama Scandals, Regulation, Texas, Waste and Fraud | 2 Comments »

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