Year+ parts inventory, ?$20 billion

Huawei has been chartering planes to bring chips to China. They’ve ordered so much most plants, including TSMC & the Koreans, have been at capacity for months. Memory chip prices are stubbornly high because of the added demand. MediaTek, NeoPhotonics, and many more are having record quarters.

The Mate 40 with Huawei’s 5 nm chip is about to be announced. The rumor is 10M are being produced with parts on hand. It’s the first 5 nm chip to the market, soon matched by the Apple A14.

Ren has committed to $20 billion in R & D. Huawei cut back in India and Australia for political reasons, but is increasing hiring in Russia and China.

Huawei will survive and thrive, I said last year before the unprecedented (and probably illegal) US blockade on chips. The US sanctions are costing Japan, Taiwan, and Korea ~$26 billion/year, per Nikkei. The long run cost to America is an order of magnitude greater.

Companies around the world are actively designing out US components because of the uncertainty of future American demands. That’s particularly true in Germany, I believe, where the US is sanctioning people because of the Germany-Russia Nord Stream pipeline.

Wars are very expensive. Economist Gardner Ackley told a US President, “You want your effing war, you raise your effing taxes.”

Someone always has to pay.

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