TSMC – Symphony

Cadence of Conflict: Asia, November 8, 2021

SymphonyNovember 7, 2021

China tripped the alarm. Revelations of a US aircraft carrier -shaped target in China’s Taklamakan Desert doesn’t exactly resemble a friendly trick-or-treat visit. Congress is upset, calling this the closest we’ve ever been. Washington tries to use calm rhetoric, saying they don’t foresee problems until 2024—it used to be 2025. But these days, they leave more and more room to avoid being wrong should a scuffle go ballistic in the Pacific.

The tech industry certainly is paying attention. Intel is building at five sites, three in the US, one in Ireland, and one in Israel. At the same time, the US government is questioning chip makers about their supply chains. One of those is TSMC, in Taiwan. Now, Congress wants to spend $52B on subsidies for chip makers inside the US. The message is clear: America is getting ready for a China-initiated disruption in the chip supply chain, the largest part in the world of which goes through Taiwan.

By the look of it, 2025 is the year when China will both be militarily dangerous and, for the chip industry, will no longer matter. While some news outlets cast China’s economy in a positive light, others show deep reasoning to sound the economic alarms. It looks like China is getting into a tighter and tighter pinch, and China’s economic response is the same as its response to political disfavor: marketing.

This week, the EU says it has unanimous support to strengthen relations with Taiwan—specifically because of China’s aggression.

In Cadence

Cadence of Conflict: Asia, May 31, 2021

SymphonyMay 31, 2021

China is in many crosshairs and Taiwan won’t have water trouble tomorrow. A long drought was going to put limits on TSMC’s chip maker in Taiwan. But, some heavy rain over the weekend and into Monday saved the day. While water rationing has yet to be implemented or delayed at press time, things are looking up, including water levels in Taiwan reservoirs.

Water wasn’t Taiwan’s only problem. A small COVID outbreak has put the nation on partial lockdown. Numbers have slowly been creeping down, but Taipei Mayor Ko is practicing for a level-up in security steps if it became necessary. But, then there is the issue of masks and vaccines.

While Taiwanese face their own trouble, they still donate masks to other countries in need. And, while Taiwan’s government seeks the Pfizer vaccine, the president says China is meddling, making access difficult. Reportedly, China signed some regional distribution rights contract with Pfizer, but unless the vaccine is ordered from Pfizer directly, the vaccine comes with no warranty. Given many recent events, including the undetermined origins of the COVID pneumoniavirus, Taiwan is unlikely to place non-warranted orders for the vaccine through China.

As for verifying any Chinese connection to COVID, China has opposed investigations that would stand to vindicate China. Australia called for an inquiry; China responded with sanctions. Them seem like fightin’ words. Prime Ministers of Australia and New Zealand met over the weekend to discuss this very matter.

China is in many crosshairs, and it took a lot of work to get there. The Chinese probably won’t want to leave any crosshairs anytime soon. But, Western consumers bought from China. So, it was a team effort.

In Cadence

Cadence of Conflict: Asia, August 3, 2020

SymphonyAugust 3, 2020

If ever there were a time when two nations didn’t want to get along, it is now. If ever there were a time when a growing group of nations decided that a single other nation never wanted to get along, it is now.

China’s security law affecting Hong Kong, defining what is a crime in every sovereign, non-China territory of the world—in a word “pretentious”. No nation’s government should ever allow a foreign government to define what is a crime within its own borders, especially a single government acting unilaterally and without counsel.

Human Rights involve laws that China directly agreed to in joining the United Nations. Human Rights sanctions over forced sterilization among Uighurs in Xinjiang in no way compare to Beijing dictating it is a crime for someone in New Zealand to voice support for free elections in Hong Kong. The Confucian-Communist Chinese don’t see the difference. They view sterilizing Uighurs as fair and international sanctions for doing so as unfair. It’s not a lie or polite statement—they really see things that way.

So, banning TikTok won’t give the Chinese any second thoughts about their aspirations and actions. Taiwan’s first democratically elected president passed away this week at 97 and the US lauded his achievement. China won’t see any need to change so as to cooperate with our democratic world today; they will only see it as an insult to China’s entitlement to greatness.

The Taiwanese chip maker TSMC provides 20% of the worlds microchips at quality of which China cannot produce any. If China invaded Taiwan and TSMC had to cease operations, China would suppose that the ability to make these chips would instantly transfer to China, where China could pick up the slack, so there would be no threat to the global tech industry.

Now, the US introduces a bill with bipartisan support for military action already approved for the US to defend Taiwan against China specifically. It’s not hard to know how China will respond. With every step, China has the same response: China’s right; the rest of the world is wrong. It’s not hard to know how the rest of the world interprets that kind of response.