Cross-straits Conflict May Have Spooked Warren Buffett to Liquidate His $4 Billion Stake in TSMC: Report

[evernessince]

He's not making EITHER argument, stop trying to make this a black or white political decision. The argument is simple: with TSMC cut off from the largest growth market (china), and the west dealing with the Not A Recession (tm) its future growth will be limited, so investing into it further doesnt make much sense

For starters, China is nowhere near the largest growth market: https://en.wikipedia.org/wiki/List_of_countries_by_real_GDP_growth_rate

Mind you said data is before the pandemic. China's GDP growth rate plummeted during the pandemic and sat at 3.8% in 2022. In the same year India maintained a growth rate of 7.8%.

Second, TSMC hardly needs the Chinese market at all. It only represents a tiny fraction of their revenues.

Third, China has made it abundantly clear that it wants to make it's own chips. What solace would it have been for TSMC to do business in China knowing the government's goal is to steal their technology and replace them with a government controlled chip fab?

Fourth, TSMC is a Taiwanese. Consider that China has an ideological vendetta against Taiwan because modern day Taiwan is full of people who fled the PRC as the PRC was killing off political dissidents. In what world do you think the current PRC government is going to provide a fair playing field or even a hospitable business environment to TSMC? You are smoking something if you think the PRC will just allow TSMC to gain influence on the mainland, China has labeled the ROC it's political enemy.

Looking at all the factors, it makes zero sense to say cutting TSMC off from China makes it a bad investment.

 

[lexluthermiester]

I donno man, feels like China is going to wait for opportunity, such as KMT return to power, then do a naval blockade for a few month to starve Taiwan out, outright invasion will trigger lots of country, China knew it too.

With the US Navy's presence a Naval blockade will not work. Any attempt of that would quickly lead to all-out war. We can not and will not let China have Taiwan. China has but two choices, back off or war(one which will end very poorly for them).

He's not making EITHER argument, stop trying to make this a black or white political decision. The argument is simple: with TSMC cut off from the largest growth market (china), and the west dealing with the Not A Recession (tm) its future growth will be limited, so investing into it further doesnt make much sense

That is very much an oversimplification. It's also not completely accurate. TSMC's growth is not as limited as some would think.

 

[trsttte]

Gambling addicts are not cured for life.

Calling Warren Buffet a gambler is a huge stretch

Just move tsmc brick by brick to US soil and give all the employees green cards. Problem solved ?

The economics of chip production (salaries, raw materials, energy, enviromental clean up, etc) don't make much sense in the US.

You need sand and not just any old sand... You need the right kind of sand/silicon to start with and although you could probrably get it shipped in, that also depends on where it's coming from.

Besides the raw materials, just the enviromental requirements costs for exemple make it hard to put stuff like this in "western" countries. I'm not arguing in any way to loosen those requirements, but we need to figure out ways to be more competitive and bring the other countries up to decent standards since we only have 1 planet after all

We were just too lazy and could simply pay to get our Chinese slaves to get it instead. Sounds harsh, but it really is the bitter truth

Not really lazy, but cared too much about the environment within our backyard, if only we didn't share the same planet anyway...

With the US Navy's presence a Naval blockade will not work. Any attempt of that would quickly lead to all-out war. We can not and will not let China have Taiwan. China has but two choices, back off or war(one which will end very poorly for them).

There were a couple of war games in the US, within a conventional war (no nukes) estimates pointed to US victory but with HUGE costs (something like 5 aircraft carriers sunk for example). One of the quotes is very worrisome

“The United States might win a pyrrhic victory, suffering more in the long run than the ‘defeated’ Chinese”

Though the only way I see for China to come out on top is for the CCP to be toppled which could be a great thing

Taiwan invasion by China would fail, but at huge US cost, analysts’ war game finds

Military experts said every participant would experience ‘enormous’ losses in any potential conflict

www.theguardian.com

 

[lexluthermiester]

There were a couple of war games in the US, within a conventional war (no nukes) estimates pointed to US victory but with HUGE costs (something like 5 aircraft carriers sunk for example). One of the quotes is very worrisome

“The United States might win a pyrrhic victory, suffering more in the long run than the ‘defeated’ Chinese”

Though the only way I see for China to come out on top is for the CCP to be toppled which could be a great thing

Taiwan invasion by China would fail, but at huge US cost, analysts’ war game finds

Military experts said every participant would experience ‘enormous’ losses in any potential conflict

www.theguardian.com

I'm not going to argue with so-called analysts, but I do know a few facts about the US Navy. For starters, no Chinese asset will get within 30 miles of a US Naval aircraft carrier. Full stop, never gonna happen, let alone five of them. Next, the Chinese submarine force is ridiculously and hilariously out classed by the US Naval submarine force. This leaves the surface fleet, which in fairness, China has a solid offering. Then there is the Chinese air force. This is the more worrisome aspect of a war with them. However, the US Navy has a few answers for that. China could bring a fight to the table, but CAN NOT win.

The loses we would suffer would be small compared to backing down and letting them have Taiwan. We CAN NOT allow that.

Then there are the nuke options. Once again, the US Nuclear arsenal ridiculously and hilariously out-classes anything the Chinese have, so if they choose the nuke option, we will wipe them off the face of the Earth in less than a day. And while they will do damage to the US, any such damage will be far less extensive. We will prevail, they will not.

And before anyone mentions the Russian nukes, you can save it. The Russian Nuclear arsenal is greatly and severely degraded compared to what it was in the Cold-War era. They have, at best, 250 viable warheads to offer and half that in usable ICBM missiles to mount them on. Their submarine launched nukes number in the dozens. So even IF Russia were to join the Chinese and go nuclear, they would be laughably out-matched.

 

[trsttte]

Then there are the nuke options. Once again, the US Nuclear arsenal ridiculously and hilariously out-classes anything the Chinese have, so if they choose the nuke option, we will wipe them off the face of the Earth in less than a day. And while they will do damage to the US, any such damage will be far less extensive. We will prevail, they will not.

Would just like to point out there are simply no winners in nuclear war, full stop. You can dream of sheep and self reliant New Zealand, but you'll starve too if you try that route. Once nukes start flying there's only the end of the world after.

 

[lexluthermiester]

Would just like to point out there are simply no winners in nuclear war, full stop.

True. But there will be those who survive it better. We will. They will not.

Once nukes start flying there's only the end of the world after.

It would change dramatically, it would not end. This planet and the life on it have survived astronomical events that invoked mass extinctions, but life bounced back. Some of us will survive.

 

[R-T-B]

Gambling addicts are not cured for life.

I wish I could gamble that well.

 

[dragontamer5788]

I'm not going to argue with so-called analysts, but I do know a few facts about the US Navy. For starters, no Chinese asset will get within 30 miles of a US Naval aircraft carrier. Full stop, never gonna happen, let alone five of them. Next, the Chinese submarine force is ridiculously and hilariously out classed by the US Naval submarine force. This leaves the surface fleet, which in fairness, China has a solid offering. Then there is the Chinese air force. This is the more worrisome aspect of a war with them. However, the US Navy has a few answers for that. China could bring a fight to the table, but CAN NOT win.

The loses we would suffer would be small compared to backing down and letting them have Taiwan. We CAN NOT allow that.

Carriers are ferocious, but the worry is that the Chinese Hypersonic missile will kill the few supercarriers we have. Without the Carrier, the rest of the CSG is still a formidable foe, but the carrier-based battles are not necessarily going to be how this war works out. Yes, AEGIS Cruisers / Destroyers form a great missile shield around our carriers, but Mach5 hypersonics haven't been used yet (either by China or USA), there is a solid chance that the Hypersonics will pierce the shield.

I don't think China can afford more than a few Hypersonic shots. Those are extremely expensive missiles. But we also don't have that many carriers, and the chance of sinking a carrier is well worth the cost.

----------

Taiwan is only 100-miles off the coast of China. Roughly the same distance as the D-Day landings, though in this case, the US Navy exists (Nazis didn't have a good Navy). That means that to have a similar response time to Chinese airplanes, our Carriers have to be within ~100 to ~300 miles from Taiwan. We can't just be sitting out at max-range and flying in each time, otherwise Chinese airplanes / missiles will land in Taiwan before our F35s can intercept.

Because our CSGs will be ~500 miles (or less) from the Chinese mainland, they will be vulnerable to Hypersonics + whatever sensor-network the Chinese has setup. The wargame linked above suggests ~2 Carriers go down or so in the fight. We'd be looking at $30+ Billion bucks down the drain in a matter of minutes. ($13B from the Carrier itself, plus all the airplanes, equipment, and 5000+ sailors). Or maybe the Hypersonics fail, who knows. Its not like they've been tested in practice yet.

 

[lexluthermiester]

Carriers are ferocious, but the worry is that the Chinese Hypersonic missile will kill the few supercarriers we have.

The hypersonic missile in question is easily detected and shot down(using Phalanx CIWS) by nearly every friget class surface vessel and above in the US Navy. It is not a great threat to our military ships. Even if it were to get passed the massive defenses an aircraft carrier commands, one or even two missiles will do little damage and CAN NOT sink or even disable a carrier. China's bluster about it's hypersonic missile is just that, bluster. It is vapid drivel at best and not to be taken seriously.

I don't think China can afford more than a few Hypersonic shots.

Perhaps. It is unknown how many they have but best theories count less than 300.

China's hypersonic missile is good for hitting non-military targets and military targets that have weak defenses, unless they put a small nuke in one. However, if they do that it'll be all out war and much of the world will join us on principle alone.

 

[dragontamer5788]

The hypersonic missile in question is easily detected and shot down(using Phalanx CIWS) by nearly every friget class surface vessel and above in the US Navy. It is not a great threat to our military ships. Even if it were to get passed the massive defenses an aircraft carrier commands, one or even two missiles will do little damage and CAN NOT sink or even disable a carrier. China's bluster about it's hypersonic missile is just that, bluster. It is vapid drivel at best and not to be taken seriously.

Perhaps. It is unknown how many they have but best theories count less than 300.

China's hypersonic missile is good for hitting non-military targets and military targets that have weak defenses, unless they put a small nuke in one. However, if they do that it'll be all out war and much of the world will join us on principle alone.

Phalanx CIWS is a machine gun with only 1-mile of effective range. Mach5+ (the slowest speed considered hypersonic) is roughly 1-mile per second, meaning CIWS only has 1-seconds to engage a hypersonic missile. Don't get me wrong, Phalanx CIWS is an incredible defensive tool, but Hypersonic changes the game entirely and is why China has sunk so much money into their project.

Note: China's YJ-21 Hypersonic Missile is Mach10 on its final approach, so that's only half-a-second for CIWS to engage.

The other defense: Patriot missiles, travel between Mach2 to Mach3, meaning the Hypersonic Missile is 3x+ faster than the Patriot and can likely outrace it.

And the shear mass + kinetic energy behind hypersonic missiles is also a threat. Even if you landed a direct hit with a CIWS, its not like half-a-second of machine gun fire will slow down a 1000kg missile very much when its already going Mach10. The point of these things is to just kill a ship from the kinetic energy alone, there's probably no explosives on the thing.

Perhaps. It is unknown how many they have but best theories count less than 300.

We only have 11 carriers, half of which are in maintenance at any given time.

Our Carriers are $13+ Billion behemoths. That means that China can afford to spend $1 Billion per missile and still have a good trade against us. I don't think that's how expensive the missiles are btw, but that's just how the economics work out in this scenario.

China's bluster about it's hypersonic missile is just that, bluster. It is vapid drivel at best and not to be taken seriously.

I hope its bluster, and there's a chance its still bluster. But IMO, the weakness is in the sensor + homing system. The Mach5+ hypersonic speed / strategy is clearly the "correct" way around the USA's missile + gun defenses around a carrier.

The question is if China's sensor network is silent and stealthy enough to provide data to the Hypersonic Missile. Whatever is providing the homing data for the YJ-21 needs to hide from an entire Carrier Strike Group, which would be no small feat.

 

[lexluthermiester]

Phalanx CIWS is a machine gun with only 1-mile of effective range.

That is incorrect. Not sure where you got that, but it's wrong.

The rest seems to be spit-balling so I'm going to call it good here as we're getting off-topic.

Final point, if China picks a fight with Taiwan and we choose to back them(which we will), China will have their hat handily handed to them.

 

[the54thvoid]

We can call it quits on the military bluster but as two people are 'disagreeing' - I googled military specs of the gun. Given that the CIWS stands for 'Close-In Weapons System', it's no surprise:

USA 20 mm Phalanx Close-in Weapon System (CIWS) - NavWeaps

www.navweaps.com

Elevation	Range
45 degrees	6,000 yards (5,500 m)
Maximum effective range	1,625 yards (1,490 m)

 

[lexluthermiester]

We can call it quits on the military bluster but as two people are 'disagreeing' - I googled military specs of the gun. Given that the CIWS stands for 'Close-In Weapons System', it's no surprise:

USA 20 mm Phalanx Close-in Weapon System (CIWS) - NavWeaps

www.navweaps.com

Elevation	Range
45 degrees	6,000 yards (5,500 m)
Maximum effective range	1,625 yards (1,490 m)

Using the link you provided;

In automatic control, the gun will prioritize the first six threats it sees at about 10,000 yards (9,100 m) and engage at 4,000 yards (3,600 m).

It is accurate anywhere within the engagement zone. This has been proven in combat exercises. That is the 1988 model revision. Recent revisions have greater range and tracking capabilities.

 

[the54thvoid]

The post you quoted to disagree with stated 'effective' range. That is clearly what I linked to, and even bolded. Nothing more.