Getting back to NORMAL will likely never happen…
A surge in Taiwan’s Covid-19 cases may worsen the global semiconductor shortage if the country implements economic shutdowns to stem the spread of the virus. In just the past two weeks, daily Covid-19 cases surged from less than ten to over 400. Actually, the current surge in Taiwan’s Covid-19 cases is nearly 20 times higher than the peak last year during the virus outbreak.
According to the article, Taiwan’s COVID-19 crisis could make global semiconductor shortage even worse:
The onset late last year of chip shortages that have hobbled industries from autos to computer gaming had looked to give Taipei global leverage. TSMC is the world’s leading provider of cutting-edge semiconductors and holds 56% of the so-called foundry business of manufacturing chips designed by customers, including Apple and Qualcomm.
But Taiwan has suffered a sudden reversal of fortunes. The pandemic comes just as a drought triggers power outages, stoking economic uncertainty and a slump in what was the world’s best performing stock index in the four years to January.
It seems that Taiwan Semiconductor (TSMC) produces a large percentage of cutting-edge semiconductors for Apple and Qualcomm. Furthermore, many of the semiconductors TSMC are made for the West and the United States. So, with Taiwan now facing a rise in Covid-19 cases, it could get much worse because only 1% of the population is vaccinated.
Thus, it wouldn’t be surprising to see Taiwan use semiconductors as LEVERAGE to get vaccines from the west, especially the United States. Here is the recent chart of Taiwan’s Covid-19 cases.
Let’s put aside the debate if Covid-19 is some grand conspiracy by the elite to control us, or a new form of first-stage Alien abduction, or any of the other dozen conspiracy theories. Let’s just focus on the surge in Covid cases and what the reaction will be by the government to keep it from spreading throughout the country, negatively impacting the vital semiconductor industry.
This is exactly the type of MONKEY WRENCH I’ve mentioned in my videos that will continue to be thrown into a high-leveraged global supply chain economy. So getting back to NORMAL will likely never happen. Already, Taiwan is dealing with a serious drought that has impacted its electricity generation and power for its industrial sector and domestic semiconductor market.
The world is running into problems not only due to the PEAK of CHEAP & EXPENSIVE OIL supply but also because we are running the Global Economic Engine at such a HIGH SPEED. Just think about running a car at 110 MPH for weeks on the interstate, only stopping for fuel. Running a vehicle at this high speed begins to STRESS the engine, tires, and many of the parts.
The Global Economy has been designed upon MAXIMUM PRODUCTION with no apparent consideration for BACKUPS or REDUNDANCIES, as mentioned by Taleb’s theory on ANTIFRAGILE. The global high-tech global economy and supply chain is the very OPPOSITE of Antifragile as it is extremely FRAGILE, and we are just beginning to experience the results.
I discuss this in my Gold Member video.
So, I could really care less about the debate on Covid-19 because there will likely be much worse stuff coming down the pipeline. We must understand when humans raise food and live in a system that is highly leveraged, that is a breeding ground for PANDEMICS. And, then… add on top of a global economy running at 110 MPH, we have a recipe for a REAL MESS.
Lastly, I do not mean to be so pessimistic, but if we look at this information and these systems logically, we shouldn’t be surprised that we have set up our economy and markets for SERIOUS FAILURE. So, with central banks adding a massive amount of debt at the very time the global engine running at 110 MPH is screaming for a meltdown, it’s important to own physical gold and silver.
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