Donald Trump's fantasy of home-grown chipmaking(economist.com)
economist.com
Donald Trump's fantasy of home-grown chipmaking
https://www.economist.com/leaders/2025/08/21/donald-trumps-fantasy-of-home-grown-chipmaking
3 コメント
Intel had a massive R&D budget and 110,000 employees circa 2020. (Vs 12k and 14k for AMD and NVIDIA, both of which have higher market caps than Intel now).
It wasn't a money problem, it was a badly run company on all fronts. When it comes to R&D the sheer magnitude of the money they squandered is legendary. They lost billions on Larrabee, billions on mobile chips, helped invent phase change memory and even made drives with it, and then dumped it for nothing, the list goes on. It's bad management all the way down, and impressively so, considering that many of these initiatives were the right products for the right time just with a horrible execution (massively parallel compute/GPUs launched Nvidia to a 4 trillion dollar valuation, mobile chips are a huge industry, etc). Arguably they needed to streamline and downsize well before they did. They were full on old school IBM level bloat.
The last few years before their implosion was indeed MBA style running the company into the ground (they had a particularly awful CEO during that period), but that was just the capstone on a large decline, during which Intel had massive budgets that they squandered.
It wasn't a money problem, it was a badly run company on all fronts. When it comes to R&D the sheer magnitude of the money they squandered is legendary. They lost billions on Larrabee, billions on mobile chips, helped invent phase change memory and even made drives with it, and then dumped it for nothing, the list goes on. It's bad management all the way down, and impressively so, considering that many of these initiatives were the right products for the right time just with a horrible execution (massively parallel compute/GPUs launched Nvidia to a 4 trillion dollar valuation, mobile chips are a huge industry, etc). Arguably they needed to streamline and downsize well before they did. They were full on old school IBM level bloat.
The last few years before their implosion was indeed MBA style running the company into the ground (they had a particularly awful CEO during that period), but that was just the capstone on a large decline, during which Intel had massive budgets that they squandered.
I bought optanes, then SSD got so good they blew them off
I envy you a bit. Truly cool and unique next level tech. Always wanted one, even if the product never quite made sense (and a shame that such an interesting piece of technology gets nixed because it doesn't "quite make sense" in the market landscape, but so it goes).
Did they blow it? From a shareholder’s perspective, if you don't have ideas on how to increase shareholder profits through innovation, then buying back shares is the right thing to do.
>From 2001-2020, Intel blew $128 billion on buybacks (64% of net income)
Is that supposed to be a lot? Sure, hindsight is 20/20 and now we know they should have spent more on R&D, but what would be the correct amount? 50% 100%?
Is that supposed to be a lot? Sure, hindsight is 20/20 and now we know they should have spent more on R&D, but what would be the correct amount? 50% 100%?
"blew" isn't accurate because stock buybacks aren't spending money. That's kind of like saying contributing to an investment account is spending money.
You can sell the stock again, or use it for employee compensation.
You can sell the stock again, or use it for employee compensation.
No, they are spending money, there is no substantial difference between dividends and buyback here since the companies issue their own stock, so they don't need to buy anything to sell it, they can try to get more money from investors in both cases.
Investment account analogy fails because you're not investing in your own ownership, so there is no "circular" relationship with yourself
Investment account analogy fails because you're not investing in your own ownership, so there is no "circular" relationship with yourself
> since the companies issue their own stock, so they don't need to buy anything to sell it,
Public companies diluting shareholders generally causes people to flee for safer investments.
A company is not a person. It doesn't always own 100% of itself.
Public companies diluting shareholders generally causes people to flee for safer investments.
A company is not a person. It doesn't always own 100% of itself.
Selling treasury stock has the same effect of diluting external shareholders, so the safety thing is the same - it depends on their assessment of the underlying reality.
And the person doesn't own himself, he is himself
And the person doesn't own himself, he is himself
[deleted]
Didn't Biden sign a 280 billion dollar Intel subsidy for chip-making? I mean as far as I can tell we already do it, this isn't a fantasy, and there's no reason to think we can't absorb more of the market. I can't read the article but it seems more political than economic, judging from the first paragraph
> 280 billion dollar Intel subsidy for chip-making?
Where are you pulling this number from?
Where are you pulling this number from?
From the CHIPS act. It allocated 280 billion, and was criticized for being an Intel bailout since many thought it was a response to their poor market performance. It was signed during the Biden admin, before trump entered office
But it wasn't $280 billion for Intel. Why are you conflating the entire amount with the amount put towards Intel?
Your statements are easily shown to be false. Intel didn't receive anywhere near that amount. It's a really poor way to try to engage with people unless your intent is to mislead.
Your statements are easily shown to be false. Intel didn't receive anywhere near that amount. It's a really poor way to try to engage with people unless your intent is to mislead.
[deleted]
The discussion was that this article calls Trump's push for chip making a "fantasy", while Biden made his own push years ago. The chips act was 280 billion, and it was widely viewed as a bill to help Intel, who is/was struggling. Nothing I said was misleading, and you're attempting to misconstrue what was said to win an internet argument with a person you'll never meet in a thread no one else will read.
[deleted]
You should consider reading the article: https://archive.ph/h1RrC
And no, Biden didn't sign a "280 billion dollar Intel subsidy for chip-making." If you're talking about the CHIPS and Science Act, that number is overall authorized funding for many things. Intel has received ~10b until now.
And no, Biden didn't sign a "280 billion dollar Intel subsidy for chip-making." If you're talking about the CHIPS and Science Act, that number is overall authorized funding for many things. Intel has received ~10b until now.
> that number is overall authorized funding for many things. Intel has received ~10b until now.
They were promised $10B. They had received only about $2B.
They were promised $10B. They had received only about $2B.
"From 2001-2020, Intel blew $128 billion on buybacks (64% of net income) on top of paying out $68 billion as dividends (35% of net income),” notes Lazonick. That’s money that couldn’t go into innovation, retaining and training employees, R&D, and other critical areas.
https://www.ineteconomics.org/perspectives/blog/america-need...