We talk a lot about free markets and other things but how is this free markets?

Intel, the icon is struggling. They got a new CEO to turn things around. He is doing his thing and Trump talks about buying a stake to help the company. Intel is a public company, why should the administration care whether it survives or dies? If the business is managed poorly, it deserves to die.

Many private businesses also demand tax payer dollars for their own benefit which they are gladly given in the name of boosting business. Chicago Bears is blackmailing both City of Chicago and Arlington Heights for tax breaks that the politicians may want to give but the people do not want to give.

We saw it in 2008 when the Administration bailed out the banks. Auto industry was also bailed out at some point. We use "free markets" only when convenient. Why is the government investing in a specific company and not its competitors?


Intel stock rises on report Trump administration eyes stake in company
https://finance.yahoo.com/news/intel-stock-rises-on-report-trump-administration-eyes-stake-in-company-204003985.html

Quote:

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Intel stock (INTC) rose more than 3% at the start of trading Friday following a report that the US government is considering taking a stake in the struggling chipmaker.

According to Bloomberg, the plan could see the government help Intel build out its planned chip complex in Ohio, which the company has had to delay as part of its ongoing turnaround effort. Intel announced the facility in 2022 with an initial investment of $20 billion that could grow to $100 billion over time.

Intel declined to comment on the report.
In a statement, a company spokesperson said, "Intel is deeply committed to supporting President Trump's efforts to strengthen U.S. technology and manufacturing leadership. We look forward to continuing our work with the Trump Administration to advance these shared priorities, but we are not going to comment on rumors or speculation."

The Ohio site was supposed to include two new manufacturing plants and start producing chips by 2025, but that's since been delayed into the 2030s. CEO Lip-Bu Tan, who took over when former CEO Pat Gelsinger was ousted by the company's board due to the slow turnaround in 2024, has since delayed the plant even further.

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No. Trump can on his own if he wants.

This might be because they are some of the few chip fab infrastructures in the US. We need to the high end chips produced here. That said sure there is some merger/tech CEO who could fix them. Maybe he needs a supply for his new robots.

The precedent for this was the creation of the IC manufacturing consortium Sematech in Austin back in the late 80s/early 90s. With DoD money, the big domestic chip manufacturing companies (Intel, TI, Motorola, and others) were given a pilot fab in order to facilitate quicker solutions to advancing the Moore's Law roadmap progression.

This was in direct response to falling behind the Japanese companies in performance and innovation, the thought being that maintaining the lead in this industry was critical to national security.

And yes, I wasted my 5000th post on this.

No

There is a name for the system where government owns the means of production. Look it up.

Hard no.

That's a no from me dawg.

An L of an Ag said:

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The precedent for this was the creation of the IC manufacturing consortium Sematech in Austin back in the late 80s/early 90s. With DoD money, the big domestic chip manufacturing companies (Intel, TI, Motorola, and others) were given a pilot fab in order to facilitate quicker solutions to advancing the Moore's Law roadmap progression.

This was in direct response to falling behind the Japanese companies in performance and innovation, the thought being that maintaining the lead in this industry was critical to national security.

And yes, I wasted my 5000th post on this.

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Username checks out. Sorry.

Stressboy said:

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This might be because they are some of the few chip fab infrastructures in the US. We need to the high end chips produced here. That said sure there is some merger/tech CEO who could fix them. Maybe he needs a supply for his new robots.

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Elon Musk?

The difference between this and tariffs:

Tariffs are going to be paid directly by the consumer. Yeah, the argument is some is going to be paid for by the foreign manufacturers, but in the end paid for by the consumer.

This will be paid for by the "government", which will then gouge the taxpayer ( I wish) or add it to the debt (the reality).


Both are protectionist. Both are bad. Getting the government involved with IBM makes it less efficient than tariffs.

OTOH, having a Duopoly (AMD and Nvidia) in most computer chips is bad and will, in the end, cost consumers.

I vote no, I think with government support Intel is still likely to fail. So not really a choice.

Hard, hard no. It wouldn't be long before the feds were using the sale and purchase of stock to dictate corporate policies.

I don't believe that Intel is any more deserving of government bailout than Qualcomm or Micron, which is to say, not at all.

Intel missed strategic movements in the semiconductor business in a similar fashion to how Bill Gates initially missed the sgnificance of the Internet in the late 1990s and was pushing CD -ROM libraries as "Information at your Fingertips" and how Steve Ballmer dug his grave by dismissing the importance of the iPhone while pumping Windows Vista.

Intel missed the significance of GPUs as the growth driver for gaming, then for crypto, and now for AI. Nvidia has sailed in blue oceans because Intel was stuck in the desktop CPU mindset. They also ignored mobile computing and let Qualcomm gain dominance without challenging them. Now, Qualcomm is eating into Intle's laptop CPU dominance with SoC Snapdragons that are on par with i7 laptop CPUs.

I have owned Intel stock off and on since the late 1990s. For most of the past 20 years, it has been a bad investment. I forgot that I had $100 a month going to buy shares throuhj their OCP when I sold my shares two years ago. The pop today is a good opportunity to sell the ~90 dollar cost averaged INTC shares at only a 10% loss.

Absolutely not. I work in the chemical industry that produces and supplies the rare gases for wafer production and Intel is in very, very deep trouble because they failed to innovate quickly enough. That is their managements fault. They need to follow through with their potential spin off of their foundry operations just like AMD and IBM did 10 years ago. Global Foundries, an American company, snapped up AMD and IBM and I'm sure they would be more than happy to take intel. An American company needs to act before TSMC, 68% market share or Samsung acts.

I'm not in favor of the government owning stock in companies, in this case it would be putting the government in direct competition with other US companies. Intel has many problems but one of the biggest is they still try to do everything and don't do any of it particularly well. Semiconductor is about specialization and they have to pick what they want to focus on. Nvidia is all about GPUS. AMD does GPUs and other chips but they are purely a design shop and outsource all manufacturing. TSMC only does manufacturing. Other chip makers specialize in different parts of the market. Intel tries to design and manufacture far too many things and they aren't the best an anything so they will continue to lose market share and fall into the abyss until they do.

Personally I think the path for them would be to sell off their design stuff and merge or buy Global Foundries to try and be a true US competitor to TSMC as a manufacturer. That would also land them a lot of subsidies which I don't love but I prefer them to an outright ownership of stock by the government and at least you can make an argument for encouraging a company to build plants in the US both for national security and jobs.

As for the government just buying a share of Intel though? Nope.

American Hardwood said:

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There is a name for the system where government owns the means of production. Look it up.

Hard no.

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does it come with a funny mustache

If we really think we need to give more direct support, then that support should be available to any/all US chip manufacturers - not just Intel. And it should be funded by tariffs or taxes on non-US chip manufacturers. If there is ANY industry the US should be subsidizing, chips would be it - more so than petroleum, farming, etc.

javajaws said:

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If we really think we need to give more direct support, then that support should be available to any/all US chip manufacturers - not just Intel. And it should be funded by tariffs or taxes on non-US chip manufacturers. If there is ANY industry the US should be subsidizing, chips would be it - more so than petroleum, farming, etc.

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I agree with this. Help should not be to a specific company. It may be acceptable to encourage certain industries (which means all players in the industry) for a limited amount of time.

This is communism and crony capitalism.

If I wanted to own intel stock, I would buy it myself. I don't want it.

Every month now seems to have a new government intrusion degrading free enterprise.

The communist agrees. Note the "others" at the end.

US Senator Sanders favors Trump plan to take stake in Intel, others
https://finance.yahoo.com/news/u-senator-sanders-favors-trump-154508520.html

Quote:

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WASHINGTON (Reuters) -Liberal U.S. Senator Bernie Sanders on Wednesday threw his support behind President Donald Trump's plan to convert U.S. grants to chipmakers, including $10.9 billion for Intel, into government stakes in the companies.

"If microchip companies make a profit from the generous grants they receive from the federal government, the taxpayers of America have a right to a reasonable return on that investment," Sanders, an Independent who caucuses with Democrats, said in a statement to Reuters.

The awards were part of the 2022 Chips and Science Act, which sought to lure chip production away from Asia and boost American domestic semiconductor output with $39 billion in subsidies.
But Commerce Secretary Howard Lutnick is now looking into the government taking equity stakes in embattled Intel and other chipmakers in exchange for the grants, sources told Reuters on Tuesday, as the Trump administration seeks "equity" in return for "investments."

The unusual alignment between Sanders and President Trump on government ownership stakes in private companies highlights a marked shift by Trump toward policies of state intervention in the economy that are typically associated with the left.

Since Trump took office for a second time in January, he agreed to allow AI chip giants Nvidia and AMD to sell AI chips to China in exchange for the U.S. government receiving 15% of revenues from the sales. The Pentagon is set to become the largest shareholder in a small mining company to boost output of rare earth magnets. And the U.S. government negotiated for itself a "golden share" with certain veto rights as part of a deal to allow Nippon Steel to buy U.S. Steel.
Sanders and Democratic Senator Elizabeth Warren had proposed an amendment to the Chips Act that would have forbidden the Commerce Department from granting a Chips Act award without the Treasury Department receiving a warrant, equity stake or senior debt instrument issued by the recipient company.
"I am glad the Trump administration is in agreement with the amendment I offered three years ago," Sanders said. "Taxpayers should not be providing billions of dollars in corporate welfare to large, profitable corporations like Intel without getting anything in return."
Much of the funding for Chips Act award recipients such as Micron, Taiwan Semiconductor Manufacturing Co and Samsung has not been disbursed.

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Sure is a lot of TDS up in this beeyotch!!!!1

Trump administration with taxpayer money, hard fno.
Trump individually, be my guest.

No

No.

Intel chips aren't even the best, either. Ryzen has them beat. Intel is going to have to swallow their pride and pivot hard into multi-core CPUs and dedicated hardware but they're so far behind I'm not sure they can catch up. They're not even an option for AI applications. They're becoming obsolete.

Personally, I'll be happy when Intel chips stop becoming standard on every laptop and pre-built desktop. The cheap "work" computers businesses always buy run like garbage.

The government can keep Intel alive through corporate welfare by giving them huge government contracts for inferior chips.

If we need Domestic chip manufacturing then the government might have to pay for it through contracts with chip makers.

Intel can't compete against AMD and the 13th and 14th gen CPUs have major quality issues. They are done unless they can pull a rabbit out of the hat

Really would make a good case study into how they fell from the top of the CPU market.

Seems like they were light years ahead in the early days of their i-series multi core and multi threaded processors. (i3, i5, i7).

Now AMD has become the market leader, and Apple is advancing their own processors.

why not? this is already turning into a command economy where everything is dictated by the whims of one person. Who is using a law that allows him to effectuate tariffs in the case of a national emergency. Yeah that's right, he's breaking the law. And the courts are gutless. And of course congress is gutless.

So yeah get used to companies being nationalized, courtesy of MAGA.

Intel is in trouble because of a series of boneheaded moves that have basically made them ride the x86 architecture into the ground while all kinds of ARM-based options and SoCs have taken over in most all spaces except hardcore gaming PCs and servers (and even there things are being chipped away). Another sign they were in trouble was how they acted after purchasing Altera. I thought they were surely going to do something cool and innovative with combo CPU/FPGA packages. Went to their developer conf a year or two after that transaction closed and was in several meetings with their executives where I asked them straight up what they had in mind there. Shrugged shoulders and nervous laughter.

The government definitely shouldn't be doing that. No more buyouts. No company is too important to fail. If you fail then you ****ed up.

No.

1. Gov shouldn't be taking ownership stake in private companies.
2. Intel is trash.

Tergdor said:

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No.

Intel chips aren't even the best, either. Ryzen has them beat. Intel is going to have to swallow their pride and pivot hard into multi-core CPUs and dedicated hardware but they're so far behind I'm not sure they can catch up. They're not even an option for AI applications. They're becoming obsolete.

Personally, I'll be happy when Intel chips stop becoming standard on every laptop and pre-built desktop. The cheap "work" computers businesses always buy run like garbage.

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I have been assembling my own PCs (I love desktops, hate laptops) since 2008-09. Every time I used Intel. The last time I built one was in 2022 and I switched to AMD. They are pretty good too, though honestly I cannot tell the difference as a user but I am told the benchmarks look good for AMD.

Intel was BIG when I was at A&M in the 90s with Pentium and "Intel Inside" ads. Even went to Portland to interview with them, they rejected me though. We were all in awe for someone we knew who worked there.