The Trillion-Dollar Chip War - Why Apple Is Worried About China?

0:00This is an iHeart Podcast. Guaranteed Human Ernest, what's up? Look, when you think about discovering small brands what store pops in your mind? Well, it should be Walmart Seriously, Walmart has thousands of small brands and they're all in one place Just go online or in store, discover and shop It could not be easier Every one of these brands has a real story and real people behind it They're true American success stories and you can find them all at Walmart Discover thousands of small brands at Walmart.com today.

0:58You worked hard for your money. Now make sure it's working hard for you. Download the Empower personal dashboard or visit Empower.com. Not an Empower client paid or sponsored. When traveling for events or festivals throughout the country, every dollar matters. We compare flights, prices, hotel rates, and restaurant options. So why wouldn't we compare rides? Personally, I always check lift before booking a ride. Prices can change throughout the day depending on traffic, weather, and what's happening in the city. If you're headed to a concert, out to dinner, or catching up with your friends on a Friday night, taking a few seconds to check lift could leave you with more money to enjoy the experience.

1:37Save money. Check lift. They don't realize smart people use smartphones, huh? Seeing through BS they thought was going to slide. Download TextNow because it cuts out clownery. You can literally activate it from your couch. Nationwide 5G with the same towers the other companies use. Pay what you want or not at all. You're in control. Show these ridiculous carriers we ain't paying for stupid. Because we're way too smart to pay dumb. Free app-based talk and text via the TextNow app requires Wi-Fi or data connection. Data plans sold separately. 5G where available. Because, yeah, the China chip market surge.

2:13We've been talking about chips for a long time. And we've seen them pull back. So, A, what's the deal with the China chip market surge? And is this something to really be concerned about? If your portfolio has SMH heavy or you're in the chip sector heavy, is it time to start being concerned? It's time. I mean, you always, I wouldn't say concerned, but you should definitely be aware of what's happening. I think a few things happened over the past couple days and you might have missed them. So we'll go over them strategically. basically. SK Hynix signed a$500 billion deal with NVIDIA. Why is that important?

2:48SK Hynix is the leader in high bandwidth memory. They control 60 % of that market. NVIDIA, obviously the leader when it comes to GPUs and obviously one of the top customers. What does that do from a strategic standpoint? It makes them say, hey, we're not just a customer anymore. We're going to have to partner on infrastructure going forward. What does that do for the bottom line for NVIDIA? It brings down that cost and it now has a strategic partner that they can build out into the future. I think it's a brilliant idea. Second piece, and this is important, not Micron, Samsung signed a deal, a$200 billion deal with Broadcom.

3:23And why is that important? Well, again, number two in the high bend with the memory sector is Samsung. But part of this deal is not just the memory piece. they've signed it for packaging and manufacturing so we talked about tsm earlier with packaging and manufacturing that is what they do they're the world leader it's not even a close second the fact that samsung is saying hey we want to do our own number one loosens the reliance on tsm but allows broadcom to have a strategic partner because they are making the custom asic silicone for Google, when we're talking about TPUs, right? Companies are now saying, hey, NVIDIA, the GPU is great, we can't afford it.

4:05We want to do this internally and have our AI stack right here within our company. Broadcom sits right in that market. So if you're trying to do custom, they can help with the custom pieces. That's a strategic partnership, I love it. What does it say for Micron? Micron has to have a very, very calculated next move. and I'll be interested to see what that partnership is. Does it mean the end for them? Absolutely not. They are still one of NVIDIA's biggest customers because the bandwidth memory demand is very high. So I think overall, has the demand changed? No. Has the story changed? No. There are strategic moves that are happening inside of the book though.

4:44Now this is why I got a little bit of intellectual smoke for Apple because they did something. There's a report allegedly. It was in the journal yesterday. It was saying that there's a fight between Micron and Apple. And the reason was Apple was saying, hey, we have to raise our prices on our next age of devices because the memory shortage and the fact that they've scaled pricing is going to affect our bottom line. And I said, OK, that's interesting, right? The company that used to dictate to people, hey, whoever has the lowest price, that's who we're going with. And so you were the bully for 10 years.

5:22You chose, I'm going to use SK Hine, so I'm going to use Samsung, or I'm going to use Micron, and whoever gives me the best deal I'm going with. The tables have now flipped. Now they create the price, and now they're saying, hey, well, how come you're charging that much? In fact, you're charging so much, now we have to charge our customers more. That was the first piece. The next piece was that, again, allegedly, Tim Cook and the Apple officials have gone to the White House to say, look, we either need to figure out what they're spending this money on because their profit margins are so high, either they're keeping it or they're price gouging.

5:58This is what their claim is on Micron. Because of that, they've asked now the president's team to allow American companies to buy Chinese memory chips. Why is that important? Well, if Americans are allowed, companies are allowed to buy a cheaper chip, right, which now becomes a quote-unquote national security issue is the reason why NVIDIA couldn't sell there, right? And now China said, we're not allowing you to sell, and we're not even going to buy. That changes the dynamics. So either the White House is going to have to decide, allow Apple to buy and allow other American companies to buy at the cost of an American company like Micron.

6:35So for Micron, you had talked about before, as far as some people were saying$1 ,600. Yep. How do you feel about that right now? I'm still at that number. I think$1 ,600 is still the number by the end of the year. You still feel comfortable with$1 ,600? 100%. A couple of reasons why. All those things I just said to you tells me that the demand hasn't gone anywhere. Right? If the demand hasn't gone anywhere and they're sold out to 2026 and potentially sold out to 2027, that story doesn't change. Do I think an administration will allow a company like Apple to buy from a Chinese manufacturer when it comes to money?

7:06It would be financial fucking treason. Exactly. Now, if they don't allow it, now what happens to Micron, right? Once they say that you can't do it, well, back to the price that you're going to pay until we figure out this bottleneck situation. Now, CXMT IPO today, it ran up 450%. Why is that important? Well, the Chinese are saying, we're not going to use your memory, Samsung. We're not going to use your memory, SK Hynix. Micron, we're not using yours. We'll build our own. And we just went over this. When you're talking about building at scale, that takes time. When you're talking about building with efficiency, that takes time.

7:40Right now, these chips will only be used by government officials. They're not selling these to companies. It takes money to build an infrastructure. When you talk about capitals that's being raised, think about how much money Micron is now worth. A year ago, it was a$200 billion company. This year, it touched a trillion. This company IPO today, it hit 8 billion. It was the largest land company in the country for the semiconductor space. At 8 billion, do you think they have the scale to build out infrastructure to now compete with trillion dollar companies? Not yet. So we just gotta be mindful of that.

8:16the only people who are worried about the destruction of smh and micron are the people who are trading it and not holding it the value of the chips um i mean i love the clip wonderful before we even did market monday's uh amd and video was talked about in 2020 you can calculate the returns from there that's the power of long-term holding do i do i think micron will come down some more yes do i think that the company is incredibly valuable yes but the only people who are worried about it are in the trade of it and not holding the stock this is not trading thursdays so let's change from market monies to hold the equities forever holy shit yeah both forever but again the vision for them is not can we win july november december the china's vision is can we win in the next decade 20 years from now right can we build our own stack and be self-reliant we don't need south korea we don't need taiwan we don't need america can we do that yeah and that they're also 20 years from now not today but if you want to know what the market is going to fall to in advance the months in advance go to inovs.com and join stock club prices are i think i put out 120 prices and more to come if you want to know red panda stocks if you want to know what to get in and get out any contagion event that's going to another thing y 'all listen to too many people i'm not going to fix any mistakes from anybody who didn't make their millions from this sorry so whoever fucked up your portfolio this is me talking whoever fucked up your portfolio don't come to me and say we'll fix this which are weekly rotation bullshit now he gotta be diplomat i'm rock the fellow i don't have time for it if you fucked up your portfolio elsewhere then go to the person who fucked them up and tell them to fix it i've been telling you the whole no stock or no sector goes up 1900 in perpetuity oh y 'all y 'all are you gambling and even what the person say somebody stole your money y 'all thought it was because i made it look easy y 'all thought it was a bunch of me's it's not it's not i'll bulk record my shit i was free when y 'all met me i'm the only one who say it i'm the only still still staying on it you go back to the early episodes the what i loved then i love now you have to hold for long periods of time but some of y 'all don't want to hear it and if you don't want to hear it that's fine one day i'm a carver shot bowed off her let's wrap the shit up yeah sometimes like okay even even started and mj had a tumultuous little relationship right they made mike sit down okay but then when mike came back he said well you saw my values when we left allegedly the pipping bulls shot the pip love you i know you dang with satoshi it's different with jordan in the league and different when he leading the team versus scotty is doing it i am begging you also to the other part on the hater park in light of dei going away there are a lot of african-american people who are paid agents of the state to tear down certain movements i proved that before.

11:32Oh, yeah. The state and the city. It's running wilder than ever. I didn't say that. I said the state. Anyway, the state. But do what y 'all want. After investments, I'm going to be gone. Ernest, what's up? Look, when you think about discovering small brands, what store pops in your mind? Well, it should be Walmart. Seriously, Walmart has thousands of small brands, and they're all in one place. Just go online or in store, discover, and shop. It could not be easier. Every one of these brands has a real story and real people behind it. They're true American success stories, and you can find them all at Walmart.

12:09Discover thousands of small brands at walmart.com today. Earners, what's up? Look, building wealth isn't just about making money. It's about knowing where your money is working for you. That's why we partner with Empower. Empower is all about helping you invest well so you can go out and live a little. Their The free Empower Personal Dashboard gives you a complete view of your financial life in one place. Track your net worth, monitor your budget, analyze your investments, set retirement goals, and more. You've worked hard for your money. Now make sure it's working hard for you. Download the Empower Personal Dashboard or visit Empower.com.

12:46Not an Empower client paid or sponsored. When traveling for events or festivals throughout the country, every dollar matters. We compare flights, prices, hotel rates, and restaurant options. So why wouldn't we compare rides? Personally, I always check Lyft before booking a ride. Prices can change throughout the day depending on traffic, weather, and what's happening in the city. If you're headed to a concert, out to dinner, or catching up with your friends on a Friday night, taking a few seconds to check Lyft could leave you with more money to enjoy the experience. Save money. Check Lyft. Before you sign off, you tuned in for ways to help teams move faster, make sharper decisions, and turn scattered context into work they can use.

13:30ChatGPT for Business can help. ChatGPT for Business gives teams a shared workspace with admin controls, permissions, and access to work and codecs in ChatGPT. This means your business can move from question to answer and code to rollout quicker. Join over 10 million business and enterprise users worldwide already using ChatGPT for work. Download the ChatGPT desktop app or contact sales to learn more. This is an iHeart Podcast. Guaranteed human.