[lukas099]

Would somebody mind explaining how this will cause a price surge? I don't understand the economics of it.

[throwaway4good]

Chips are mostly development cost; once designed they cost little to produce and even less with economies of scale.

Cutting yourself off the massive Chinese market will cause more expensive tech in the west as there are fewer people to sponsor its development.

[kube-system]

Chips are mostly supply limited over the past few years. Economies of scale go away or even decrease once you reach the limits of your production.

[k_sze]

But I thought the price surge of nvidia gpus in the past few years were demand-driven because of crypto mining?

[throwaway4good]

Yeah. What I wrote is what in general happens long term. Short term all short of things can happen: a factory burns down - dram spikes in price, covid, financial crisis kills demand firesale across the board, spike in crypto drives up gpu demand etc etc