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Been gone a while.. GPU prices questions.

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Was looking at GPU prices and since ive been gone they seem to have skyrocketed. Havent looked at hardware in maybe a year but even used 1060s etc, have gone up substantially since even 3 years ago. What caused this? Is it expected to last?
 
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it's supply and demand.
supply is low, demand is high, and it seems manufacturers, wholesalers, retailers, scalpers have all taken advantage of such situation
2nd hand market is literally insane, some cards go for double MSRP, as you can tell when you looked up a GTX 1060 price lol
no end in sight as far as I am concerned
 
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Short answer: there is a massive supply vs. demand imbalance.

Longer answer: It's unrealistic to regurgitate thousands and thousands of news articles written in the past eleven months about this. There are probably 10-15 major factors that have contributed to this.

Start by reading this short April 2021 article by Brad Chacos from PC World:


Several points: there is no single factor that caused today's situation. Some dimwitted people might point their fingers at a specific factor -- like cryptocurrency miners -- but all of their logic falls apart with the most superficial analysis. That's why Chacos says it's complicated.

Apparently you have been living under a rock since the semiconductor shortage has affected many other industries such as automobile manufacturing (including manufacturing line shutdowns due to chip shortages). If you had a retirement account or even just read mainstream business news, this would not be a surprise to you because it affects companies like Ford, GM, and Toyota.

For supply, the primary issues are insufficient capacity and materials shortages. There aren't even foundries either on the latest nodes or the older nodes. That's why it's not just GPUs that are hard to get. ICs for automobile and industrial applications -- which aren't on the latest nodes -- are also affected. The materials shortages are widespread. It's not just substrate materials for silicon wafers. It's pretty much everything: metals, plastic, etc. Have you seen the price of lumber in the past year?

From a GPU perspective for demand, it was a perfect storm. The launch of two new videogame console lines (Xbox Series X|S and PlayStation 5) combined with Ampere (Nvidia) and RDNA2 (AMD) graphics card releases -- all at the same time -- put extra demand on the newest nodes and thus Samsung and TSMC's foundry capacity. Both AMD and Nvidia have prioritized chip deliveries to their major customers: Microsoft/Xbox, Sony Interactive Entertainment, and major PC builders (Dell, HP, Lenovo, etc.). That's why a prebuilt PC is currently the easiest way to obtain one of the latest GPUs.

Even the local mom-and-pop PC shops have top tier AIB graphics cards in their locked glass display cases. Customers need to buy a bunch of other components at the same time or order a custom built PC to get one of those desirable cards.

Don't listen to anyone who blames crypto miners. GPUs prices did not plummet when the crypto prices plummeted. Also as you will note, graphics cards that are useless for mining (like the Pulse RX 550 2GB that I picked up in September 2020 for $65) have also skyrocketed in pricing. It's worth pointing out that bitcoin is mined on custom ASICs -- not GPUs. Crypto pricing is almost exclusively determined by buyers and sellers: not by mining activity or total hashrate.

When will this end? Sorry, my crystal ball is in the shop. However all of the major industry leaders (AMD's Dr. Su, Nvidia's Huang, Intel's Gelsinger) don't expect the situation to get any better until late 2022 at the earliest. No one here will give you any better estimate. One thing for certain: no one will be buying graphics cards below MSRP for the next couple of years.

Another thing for sure, supply constraints -- particularly manufacturing capacity -- will not be solved overnight. A new foundry costs billions of dollars and years to build; the semiconductor industry is notoriously loathe to start new foundries if there's any risk of standing idle. That's a big capital investment not generating revenue. Twenty years ago there were something like 20-25 semiconductor manufacturers. Now there are essentially three: Intel, Samsung, and TSMC.

Supply chain issues aren't exclusive to the graphics card business. They are prevalent pretty much in every industry on this planet. Compare your grocery bill today from a year ago.

There are other factors. Sure, COVID-19 but again it's not the only factor. Climate change affects a lot of supply; in the case of semiconductor manufacturing, the drought in Taiwan (where many of the foundries are) has resulted in reduced availability of water which is a major resource necessary for chip production. Again it's complicated and the factors go far beyond Chacos's superficial analysis.

For graphics card availability, the biggest issue are the people who are willing to pay scalper prices for GPUs. They are essentially the main cause of today's prices.

However, this is a free market economy, sellers will price items at what buyers will pay. The prices will come down when buyers stop paying exorbitant prices. This isn't exclusive to the PC graphics card business. This is pretty much the same for anything: heads of lettuce, sex toys, real estate, sneakers, Class B shares of Berkshire-Hathaway, whatever.

Patient buyers will have an easier load on their wallets. Impatient buyers will get reamed.
 
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Update: Intel CEO Pat Gelsinger now expects supply-demand imbalance to last until 2023.


His comment is about the broad semiconductor/electronics landscape not just graphics cards.

My personal guess is that this a conservative estimate and that it will continue well into 2023. With the supply constraints and zero excess capacity, I simply don't see how we will reach a supply-demand balance by 2022.

For sure we are not going to wake up one day and all graphics cards will magically be at MSRP or lower and available to ship immediately. Not going to happen.
 
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You were gone quite a while then. In short ~

Covid > Bust > Crypto > Boom > Bubble :slap:
Again this is an oversimplification and slightly inaccurate.

Graphics cards prices skyrocketed well after the pandemic started, basically around early November 2020 (coinciding with the launch of Ampere, RDNA2 graphics cards and the two aforementioned videogame console lines).

The pandemic started in earnest in March 2020 yet graphics card pricing stayed stable for another seven months. COVID-19 eventually had a delayed and protracted impact on semiconductor manufacturing but it did not have an immediate effect on chip prices.

Between April 2020 and October 2020 I bought in succession a Sapphire Pulse Radeon RX 580 8GB ($180, below MSRP), Nvidia GeForce RTX 2070 Super FE 8GB ($499, at MSRP), and Sapphire Pulse Radeon RX 550 2GB ($65, below MSRP). All of these are now going for 3-4x their launch prices. Since the two Radeon cards (Polaris and Lexa Pro) haven't been in production for a while, most of what is available are used or "refurbished" or "renewed" cards that are going for 3x original MSRP.

Note that two of these three cards are suitable for ETH mining and crypto prices had zero effect during those seven months.

Poor availability of the new gen graphics cards influenced buyers to shop for older cards which drove those prices up. There is no freakin' way I'd pay $300 for a RX 550 with a measly 2GB of VRAM (and 4+ year old graphics architecture) but some people will do so. The actual value of this card today is realistically $50-55.
 
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Graphics cards prices skyrocketed well after the pandemic started, basically around early November 2020
I was counting everything related to Covid, including the global economy ~

Post Covid stock markets tanked, someone had to pay to offload crude oil tankers(?), world economy was looking in peril & then crypto also tanked. Then it rose followed by a real boom in mining, followed by what you could argue is a bubble currently.
 
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Post Covid stock markets tanked, someone had to pay to offload crude oil tankers(?), world economy was looking in peril & then crypto also tanked. Then it rose followed by a real boom in mining, followed by what you could argue is a bubble currently.
Again, more oversimplication and slightly inaccurate.

The S&P 500 started tumbling well before the first lockdown in the USA which was March 16, 2020 in Santa Clara County, California. That was basically when that index bottomed out (about 2300 points), dropping from its 2020 (to date) high of about 3380 points on February 10th. It turned to this level by August 10th, the "V shaped recovery". The S&P 500 ended calendar 2020 around 3760 points, +16% from the previous year's close.

There was no corresponding fluctuation of graphics card pricing during the February-August dip and recovery.

I'll point out that the S&P 500 is trading around 20% higher today than its 2020 peak (which was basically at the end of the year). The stock market is not the economy.

I'll reiterate that it was an explosion of demand that has put the electronics industry in its current situation. Remember that there are semiconductor shortages in other industries (like the aforementioned automobile industry) where the chips are coming from older nodes.
 
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Frick

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Personally I'm not hopeful of ever seeing anything in life returning to "normal". As for GPU prices, the world has proven to be prepared to buy anything avaliable, even when at +50% MSRP and even used. I can't see any reasonable businessman looking at that and hoping for a return to "normal". Had there been more suppliers the prices had been more likely to plummet, but there is currently two manufacturers of these things, three if you count Intel.

And it's not just silicone products either. Steel prices are bonkers (+150% since january 2021, expected to triple Q1 2022). The entire freight industry from China is thoroughly tits up. The car industry is suffering due to semiconductor shortages. Fertilizer costs are spiking, leading to more expensive foods. I'm not one for secular doomsday scenarios but a shortage of gaming grade GPU's are way down on the list to care about.
 
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The S&P 500 started tumbling well before the first lockdown in the USA which was March 16, 2020 in Santa Clara County, California.
Pretty sure Covid was a much bigger news well before S&P tanked, unless you think lockdown was supposed to be a trigger? It was probably the biggest reason for oil prices (futures?) going negative but the crash wasn't triggered due to US lockdown.
I'll reiterate that it was an explosion of demand that has put the electronics industry in its current situation.
The biggest issue was supply chain, not the components in & of itself. A lot of the products in the electronics industry, as has been pointed out, rely on just in time (JIT?) manufacturing so they keep stock of various components at rather lower levels than similar industries like say automobiles.
Remember that there are semiconductor shortages in other industries
The production of semiconductors is still at an all time high, despite the spike during the pandemic there was also demand destruction due to the global economy tanking.

I will say though that I haven't followed GU prices closely throughout the last year but surely you're downplaying the impact of Covid or what actually led to the global stock market crash!
 
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Pretty sure Covid was a much bigger news well before S&P tanked, unless you think lockdown was supposed to be a trigger? It was probably the biggest reason for oil prices (futures?) going negative but the crash wasn't triggered due to US lockdown.

The biggest issue was supply chain, not the components in & of itself. A lot of the products in the electronics industry, as has been pointed out, rely on just in time (JIT?) manufacturing so they keep stock of various components at rather lower levels than similar industries like say automobiles.

The production of semiconductors is still at an all time high, despite the spike during the pandemic there was also demand destruction due to the global economy tanking.

I will say though that I haven't followed GU prices closely throughout the last year but surely you're downplaying the impact of Covid or what actually led to the global stock market crash!
In the USA COVID-19 was not big news in early 2020. Remember that many people (including the previous administration) dismissed it as a CCP problem. In fact, SARS-CoV-2 wasn't identified and named until early 2020 and the COVID-19 designation was given once researchers looked back and saw that it emerged in 2019.

Semiconductor production is at an all-time high (foundry capacity is maxed out) but demand is higher.

As for demand destruction, it doesn't show up in the earnings statements of the large cap corporations. There have been successive quarters of massive earnings.

Remember that the S&P 500's bottom coincided with the first US shelter-in-place order.

The stock market A.) isn't the economy, and B.) is forward looking. The S&P index had already priced in the impact of the lockdown before it was in full swing. It would be weeks before the much of the rest of the country went into shelter-in-place.

In late 2019, there were already whisperings of a possible market correction. Well, it happened before COVID-19 dug in its heels and forced Americans and the majority of the world to live, work, study differently.

Remember in the USA in mid-March 2020 there had only been a handful of identified COVID-19 fatalities in the USA. Testing availability was poor and many of the initial implementations were completely disorganized.

I remember March 16, 2020 because I live in Santa Clara County. At the time, the general sentiment in the rest of the nation was "look at those nutty liberal Californians" (or even ruder commentary). I remember getting my hair cut the day before the shelter-in-place order took effect. The locals had emptied store shelves of toilet paper, bottled water, other basic staples weeks before the rest of the country followed suit.

By then the S&P 500 index had already started its recovery.

But since you aren't convinced, here's the S&P 500 index since January 2020 versus the tech-heavy Nasdaq Composite (^IXIC), Nvidia, AMD, and Intel.

2021-10-22 14.22.19 finance.yahoo.com 81700b9b5c4e.png


By August 10, 2010, the S&P 500 had already rebounded. The Nasdaq Composite was well above this. Look at where Nvidia and AMD stood. Their growth has continued. Only feeble Intel underperformed the S&P 500.

See any demand destruction?

Remember that this V-shaped recovery happened well before the peak COVID-19 daily deaths in late 2020 and early 2021.

Oh yeah, both NVDA and Broadcom (AVGO) hit their all time intraday highs today. AMD is also flirting with its all time high.
 

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In the USA COVID-19 was not big news in early 2020.
Can't dispute that since I'm not actually from teh US but it was already a near global catastrophe level by the time US woke up to the disaster. The China ban followed by Europe travel ban, then almost every other country on earth IIRC.
Remember that many people (including the previous administration) dismissed it as a CCP problem.
That was mostly masses & ill informed people dismissing it, stock analysts & people paid to do their job higher up knew the potential disastrous impact of Covid.
In fact, SARS-CoV-2 wasn't identified and named until early 2020 and the COVID-19 designation was given once researchers looked back and saw that it emerged in 2019.
Yes but "early 2020" is a rather vague & vast timeframe, can you be more specific? Like what about Covid ripping through Europe in early 2020?
There have been successive quarters of massive earnings.
Margins ~ the biggest reason for massive spike in earnings. Almost every major chip manufacturer expanded margins in the last year or so.
The S&P index had already priced in the impact of the lockdown before it was in full swing. It would be weeks before the much of the rest of the country went into shelter-in-place.
I'd argue without knowing the full implications of the disease at the time, any vaccine or potential cure ~ the death toll was the biggest fear! Lockdowns would hurt less as the US gave away billions worth of checks to people in need of support.
Remember in the USA in mid-March 2020 there had only been a handful of identified COVID-19 fatalities in the USA.
Yes but you only had to look at China & Europe to know what was coming to the US. Anyone not a Trump follower knew it was only a matter of time when Covid would strike across basically the entire world.

Anyway I see you have a slightly different take on this matter, which is fine by me. I'll just reiterate :p
Covid > Bust > Crypto > Boom > Bubble :toast:
 
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Yes but "early 2020" is a rather vague & vast timeframe, can you be more specific? Like what about Covid ripping through Europe in early 2020?
Here you go, a CDC press release from February 29, 2020:


That was sixteen days before Santa Clara County's public health officer Dr. Sara Cody's shelter-in-place order took affect which she issued on March 15th giving county residents less than a day:


Much later earlier COVID-19 fatalities were identified but in March 2020, it was believed that the first US COVID-19 fatality was a woman from San Jose (Santa Clara County).

Margins ~ the biggest reason for massive spike in earnings. Almost every major chip manufacturer expanded margins in the last year or so.
Shareholders aren't going to be satisfied with just protecting margins. They also want to see revenue growth. This is not unique to the semiconductor industry.

Anyhow, returning to the original discussion, the start of the global COVID-19 pandemic in March 2020 had zero effect on worldwide GPU pricing at the time and for the next seven months.

Both AMD and Nvidia have increased total unit sales. The issue that many at sites like TPU is that the lack of availability of discrete graphics cards for the DIY PC builder market. Scalpers are using 'bots to scoop up inventory and reselling to people who are desperate.

Note that scalping isn't exclusive to graphics cards or even PC hardware. People have been doing this any place there is a free market economy and items that are particularly desirable. This is not new. Want to buy tickets for the championship game?
 
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Short answer: there is a massive supply vs. demand imbalance.

Longer answer: It's unrealistic to regurgitate thousands and thousands of news articles written in the past eleven months about this. There are probably 10-15 major factors that have contributed to this.

Start by reading this short April 2021 article by Brad Chacos from PC World:


Several points: there is no single factor that caused today's situation. Some dimwitted people might point their fingers at a specific factor -- like cryptocurrency miners -- but all of their logic falls apart with the most superficial analysis. That's why Chacos says it's complicated.

Apparently you have been living under a rock since the semiconductor shortage has affected many other industries such as automobile manufacturing (including manufacturing line shutdowns due to chip shortages). If you had a retirement account or even just read mainstream business news, this would not be a surprise to you because it affects companies like Ford, GM, and Toyota.

For supply, the primary issues are insufficient capacity and materials shortages. There aren't even foundries either on the latest nodes or the older nodes. That's why it's not just GPUs that are hard to get. ICs for automobile and industrial applications -- which aren't on the latest nodes -- are also affected. The materials shortages are widespread. It's not just substrate materials for silicon wafers. It's pretty much everything: metals, plastic, etc. Have you seen the price of lumber in the past year?

From a GPU perspective for demand, it was a perfect storm. The launch of two new videogame console lines (Xbox Series X|S and PlayStation 5) combined with Ampere (Nvidia) and RDNA2 (AMD) graphics card releases -- all at the same time -- put extra demand on the newest nodes and thus Samsung and TSMC's foundry capacity. Both AMD and Nvidia have prioritized chip deliveries to their major customers: Microsoft/Xbox, Sony Interactive Entertainment, and major PC builders (Dell, HP, Lenovo, etc.). That's why a prebuilt PC is currently the easiest way to obtain one of the latest GPUs.

Even the local mom-and-pop PC shops have top tier AIB graphics cards in their locked glass display cases. Customers need to buy a bunch of other components at the same time or order a custom built PC to get one of those desirable cards.

Don't listen to anyone who blames crypto miners. GPUs prices did not plummet when the crypto prices plummeted. Also as you will note, graphics cards that are useless for mining (like the Pulse RX 550 2GB that I picked up in September 2020 for $65) have also skyrocketed in pricing. It's worth pointing out that bitcoin is mined on custom ASICs -- not GPUs. Crypto pricing is almost exclusively determined by buyers and sellers: not by mining activity or total hashrate.

When will this end? Sorry, my crystal ball is in the shop. However all of the major industry leaders (AMD's Dr. Su, Nvidia's Huang, Intel's Gelsinger) don't expect the situation to get any better until late 2022 at the earliest. No one here will give you any better estimate. One thing for certain: no one will be buying graphics cards below MSRP for the next couple of years.

Another thing for sure, supply constraints -- particularly manufacturing capacity -- will not be solved overnight. A new foundry costs billions of dollars and years to build; the semiconductor industry is notoriously loathe to start new foundries if there's any risk of standing idle. That's a big capital investment not generating revenue. Twenty years ago there were something like 20-25 semiconductor manufacturers. Now there are essentially three: Intel, Samsung, and TSMC.

Supply chain issues aren't exclusive to the graphics card business. They are prevalent pretty much in every industry on this planet. Compare your grocery bill today from a year ago.

There are other factors. Sure, COVID-19 but again it's not the only factor. Climate change affects a lot of supply; in the case of semiconductor manufacturing, the drought in Taiwan (where many of the foundries are) has resulted in reduced availability of water which is a major resource necessary for chip production. Again it's complicated and the factors go far beyond Chacos's superficial analysis.

For graphics card availability, the biggest issue are the people who are willing to pay scalper prices for GPUs. They are essentially the main cause of today's prices.

However, this is a free market economy, sellers will price items at what buyers will pay. The prices will come down when buyers stop paying exorbitant prices. This isn't exclusive to the PC graphics card business. This is pretty much the same for anything: heads of lettuce, sex toys, real estate, sneakers, Class B shares of Berkshire-Hathaway, whatever.

Patient buyers will have an easier load on their wallets. Impatient buyers will get reamed.
I'm still waiting for prices on some sex toys to drop. I need more sex toys, they keep breaking.
 
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That was mostly masses & ill informed people dismissing it, stock analysts & people paid to do their job higher up knew the potential disastrous impact of Covid.

They did not know. That is why they overreacted and we're in this current mess, if they had dismissed we'd all have been better off economically. Heck I'd go as far to say it would have done everyone a solid had this dismissed considering Covid would have been a welcomed development in dealing with overpopulation issues.

It started with miners and nvidia, scalpers blew things wide open and there just have been several factors keeping prices propped up.
 
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eidairaman1

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Was looking at GPU prices and since ive been gone they seem to have skyrocketed. Havent looked at hardware in maybe a year but even used 1060s etc, have gone up substantially since even 3 years ago. What caused this? Is it expected to last?
Miners, those with too much money and no sense.
 
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Miners, those with too much money and no sense.
Or those with a GPU, a desire to game, a screensaver that mines, and good sense.

I'm a miner, and I'm not rich. It does help pay off the absurd hardware costs now though to mine when idle.
 
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Miners, those with too much money and no sense.
Hi,
Yeah I believe it's more dollars than sense

But often you have to spend money to make it.
Tad on the expensive side just for gaming though 1k.us for a asus 3070ti lol
 
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I'm still waiting for prices on some sex toys to drop. I need more sex toys, they keep breaking.
so many questions. many i dont want answer...
btw the asus noctura gpu might suit you thru,
 
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I managed to buy a 3090 below msrp!
 
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Yeah I believe it's more dollars than sense
Considering how many dollars I have (basically $150 disposable each month after bills), you must really think me slow indeed.
 
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Considering how many dollars I have (basically $150 disposable each month after bills), you must really think me slow indeed.

R-T-B, they're saying
Miners, those with too much money and no sense.

Miners (specifically) those with too much money and no sense, not all miners stop being triggered.
 
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If that's true I apologize for the diversion.

No triggering. Just food for thought.
 
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Also it depends on where you live. There are plenty of RTX 3060 Ti here, but the prices are up 50% what they were at launch last year. The prices for an entry 3060 Ti like EAGLE from Gigabyte were in December 2020 about 2800-3000 RON(~700$) and they are now up to 4400-4600 RON(~1060$).
 
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