The US-China Tech Race

Bullish:

• $TSMC - TSMC has established a dominant position in advanced semiconductor manufacturing with over 90% market share in the most advanced nodes, benefiting from a unique non-competitive business model that allows them to innovate specifically for their customers' needs.

  • “TSMC, Taiwan Semiconductor Manufacturing Corporation, it turned out that their business model became a choke point because their model was, we'll focus just on the manufacturing process, and we won't compete with our clients... they're able to uniquely push the manufacturing innovation to the needs of their customers. And so that model proved to be really amazing. So now they produce over 90% of the most advanced nodes.”

    Paul·17:22
• $ASML - ASML holds an absolute monopoly in extreme ultraviolet (EUV) lithography tools, which are essential for manufacturing the most advanced semiconductors, making them an irreplaceable chokepoint in the semiconductor supply chain.

  • “ASML, this Dutch company, ended up developing the most advanced lithography, extreme ultraviolet lithography tools over the course of the last twenty years... to get to the most advanced architectures and feature sizes, for semiconductors, you need EUV.”

    Paul·14:17
• $NUCLEAR - Nuclear energy is becoming critical for US competitiveness in AI infrastructure, with heavy investment needed despite long development timelines.

  • “We are leaning now. We're heavily into nuclear, and we need to, but then it's gonna take a while to achieve that.”

    Mark·7:46
• $MIDEAST - Middle East infrastructure is positioned to benefit from AI data center buildout due to the region's access to cheap power, addressing US power constraints.

  • “Because of that power issue that The US has, probably a lot of data centers will get built in The Middle East, and US companies will use those just because The Middle East has access to so much fairly cheap power.”

    Paul·24:09
• $RAREEARTH - Rare earth minerals are strategically important with the US vulnerable to China's dominance, though the US has been slow to take deliberate action despite recognizing the issue.

  • “The US needs to take that seriously, but we've known about this for a while, and we've admired the problem as opposed to really taking deliberate steps.”

    Mark·4:54

Bearish:

• $INTC - Intel faces significant challenges in becoming globally competitive again, with government intervention potentially preventing necessary restructuring actions.

  • “it's unclear how, for example, taking an ownership interest in intel is going to be long term beneficial, or could that be negative to the extent that either a real or perceived golden share prevents some of the tough actions for restructuring that are going to be necessary for Intel to become globally competitive again.”

    Mark·9:54