Posts Tagged ‘Texas Instruments’

“Why Is Everyone Investing in Texas?”

Saturday, October 17th, 2026

I’ve been covering some of these issues since all the way back when I was doing the Texas vs. California updates, but this video offers a nice summary.

  • “Texas has been one of the biggest winners of the blue state exodus, and now it’s pushing to become a real financial powerhouse.”
  • “If Texas were its own country, its economy would be the eighth largest in the world. Bigger than Russia, bigger than Canada, bigger than Italy. That’s the state’s preliminary 2025 GDP, $2.9 trillion, measured against every other nation on Earth.”
  • “Goldman Sachs is building an 800,000 square foot campus in Dallas. When it opens, more than 5,000 people will work there. It’ll be the firm’s second largest office in the United States. Goldman isn’t moving its headquarters, but between 2015 and 2024, 314 companies did. Nearly half of them, 154, went to Dallas Fort Worth. By 2026, Texas had 57 Fortune 500 headquarters, more than any other state, with about $2.8 trillion in combined annual revenue.”
  • “The state that outsiders picture as a ranch currently produces the world’s richest person and the world’s richest woman at the same time. Elon Musk, based in Austin, is worth $839 billion. Alice Walton, based in Fort Worth, is worth $134 billion and has held the top spot amongst women for three straight years.”
  • “Forbes counted 43 Texans on its 2025 list of America’s 400 richest people worth more than $1 trillion combined, the first time the group has cleared the mark.”
  • “Dallas Fort Worth does finance and corporate services. Houston does energy, chemicals, and ports. Austin does technology and semiconductors. San Antonio does military, healthcare, and manufacturing.”
  • “Those four metros sit inside a triangle bounded by Interstate 35, Interstate 45, and Interstate 10. Together, they employ more than 10 million people, more than the entire workforce of Sweden, and run about 2 trillion a year in a combined economic output. Over the last decade, 85% of all Texas population growth happened inside that triangle, which is why the state can carry finance, energy, technology, and manufacturing investment all at the same time.”
  • “Oil still anchors the biggest of those four economies. In 2025, Texas pumped 5.75 million barrels of crude oil a day, 42% of all US production. If Texas were a country, it would rank fourth in the world in oil output behind only the United States, Russia, and Saudi Arabia.”
  • “Texas is the only state that spent nine years as its own sovereign nation, the Republic of Texas. from 1836 to 1845, before voting to join the union.”
  • “That history still shows up in how the state regulates business today. No state income tax, a right to work law, and a legal and regulatory environment built to keep the cost of doing business low.”
  • “Chief Executive Magazine has ranked Texas the best state in the country for business every year since the survey started in 2001.”
  • Fort Worth rent is less than half that of Manhattan.
  • “Since February 2020, finance, insurance, and real estate employment in Dallas grew 23.2% versus 6% in New York City. Dallas now has about 317,000 people working across those sectors, 10.1% of local employment, just above New York City’s 9.9%.”
  • “New York Stock Exchange Texas says Texas headquartered companies listed on the exchange represent more than 5 trillion in market value, up 1.5 trillion in a year.”
  • “Texas is also becoming a place where capital intensive companies build physical things at a scale most states can’t host. Samsung is spending more than 37 billion on two logic fabs and an R&D fab near Austin, with the first set to begin production this year. Texas Instruments is spending up to $40 billion on four connected fabs in Sherman, part of a $60 billion commitment the company calls the largest in US semiconductor history. Between those two projects alone, more than $77 billion in committed capital is going into two Texas counties.”
  • “Once you can manufacture at that scale, the parts have to come from somewhere. For Texas, the answer is 150 miles south. Port Laredo handled $353 billion in trade in 2025. More than 97% of it tied to Mexico, making it the busiest inland port in the Western Hemisphere. Mexico passed China in 2023 to become America’s largest trading partner.”
  • “Companies assemble AI hardware in Mexico using Nvidia chips, then just ship it north through Texas.”
  • “All of that growth is now straining the infrastructure underneath it. Dallas Fort Worth became the third largest collocation data center market in the country in the first quarter of 2026, with capacity up 43.7% in a single year, and 88% of what’s under construction has already been pre-leased.”
  • “ERCOT was tracking roughly 410 gawatt of proposed large loads seeking grid connection by 2030. Enough that regulators changed how they study new loads.” Hence Texas Governor Greg Abbott telling data center companies they had to pay for their own data centers.
  • “Housing shows the same pressure. DFW home prices were up about 33% above 2020 levels by 2025. In Austin, it was about 23%.” Maybe, but Austin experienced a huge housing price spike in 2021-2023 before coming down again.
  • “In 2024, the state still authorized 225,000 new housing units, more than California and New York combined. In Dallas and Houston were the two busiest metro areas in the country for new home construction.”
  • “This shows that capital trusts Texas can build.”
  • “From the 1990s through the 2010s, Texas competed on cost. Cheap land, cheap labor, no income tax.”
  • “From 2015 to 2020, corporate migration accelerated on that same cost advantage.”
  • “From 2020 to 2024, COVID, remote workers, and a wave of relocations turned migration into a flood. Texas added residents faster than any other state.”
  • “From 2024 to 2026, finance, AI, infrastructure, semiconductors, manufacturing, and logistics arrived on top of that migration at a scale the cost argument alone would have never attracted. Texas isn’t competing on cost anymore. It’s competing on scale, on the ecosystem that scale builds around itself.”
  • “Tesla announced Gigafactory Texas in 2020 with more than one billion of expected investment, moved its headquarters to Austin in 2021, and had about $2.7 billion in Travis County by 2022.”
  • “Then Musk’s other company did something bigger. SpaceX went public in June 26 at $135 a share, raising about $75 billion, the largest IPO in history.” Actually, $86 billion. “And Musk crossed a trillion dollars in net worth within minutes of the open. More than 4,400 current and former SpaceX employees became millionaires the same day the company listed and roughly 400 of them cleared 100 million or more.”
  • “Dallas has the labor pool, the exchanges, and nearly half of the headquarters that moved here. Sherman and Taylor have the fabs. Laredo has the border. The Permian still pumps more oil than any other basin in the country. Every new campus, every new fab, every new resident adds another user to the infrastructure underneath it.”
  • “That’s what Goldman is buying here. A seat in the place where American capital is choosing to live for the next 20 years.”

    • Somehow he failed to mention that Republicans have held every statewide office in Texas for closing in on 30 years…

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    Posted in Austin, Republicans, Technology, Texas, video | 3 Comments »

    Instant Analysis: Trump Tariff Effects On Semiconductors

    Wednesday, April 2nd, 2025

    President Trump announced his tariffs on countries, especially those that tariff goods from the United States.

    President Donald Trump on Wednesday imposed sweeping new tariffs on all imported goods and unveiled a detailed list of reciprocal duties targeting more than 60 countries, asserting that the move is necessary to combat trade imbalances and restore U.S. manufacturing.

    “This is Liberation Day,” Trump said during a Rose Garden ceremony, holding up a printed chart of countries and their new tariff rates. “For decades, our country has been looted, pillaged, raped and plundered by nations near and far, both friend and foe alike.”

    The tariffs, which he described as “reciprocal,” fulfill a key campaign pledge and are aimed at pressuring trade partners to lower their own barriers. The administration expects the new rates to remain in place until the U.S. narrows a $1.2 trillion trade imbalance recorded last year.

    But the extensive list of tariffs also threatens to upend the U.S. economy, as many — but not all — economists say they amount to taxes on American companies that will be passed down to consumers.

    Trump held up a chart while speaking at the White House, showing the United States would charge a 34 percent tax on imports from China, a 20 percent tax on imports from the European Union, 25 percent on South Korea, 24 percent on Japan and 32 percent on Taiwan.

    The centerpiece of the announcement is a 10 percent universal baseline tariff on all imports, effective immediately. For instance, Chinese imports are now subject to cascading tariffs of 10, 20 and 34 percent, for a total of 54 percent.

    In addition, Trump’s administration imposed country-specific reciprocal tariffs on nations it accuses of unfair trade practices — including India, Vietnam, and the European Union, in adding to China. The rates are calibrated at approximately half the rate those countries impose on U.S. goods.

    For example, China, which Trump said charges 67 percent in tariffs on U.S. goods when factoring in non-tariff barriers, will now face a 34 percent reciprocal tariff under the new system, in addition to the 10 percent baseline tariff and the 20 percent tariffs already in effect. Vietnam, assessed at 90 percent, will face a 46 percent tariff; India at 52 percent will now see 26 percent duties; and the EU, which imposes 39 percent, will be met with a 20 percent response, according to the White House chart.

    This is a “devil in the details” issue that has a lot of ramifications depending on how the directives are written. But several of those countries are big players in semiconductors, so here’s a quick and dirty look at winners and losers if those tariffs stay in place a significant amount of time.

    The main countries here, along with the reciprocal tariffs being applied to them:

  • Taiwan (32%)
  • South Korea (25%)
  • China (34%)
  • European Union (not a country, but they play one on TV) (20%)
  • Japan (24%)
  • Singapore (10%)
  • Israel (17%)

    • Save a few smaller, older fabs here and there, that’s pretty much 99% of semiconductor manufacturing, though Vietnam (46%) and the Philippines (17%) do a lot of semiconductor package assembly work, and the tariffs may apply to them, depending on wording.

    So let’s look at the business Losers and Winners in the space. (Note: You might find this post useful, as it defines some of the semiconductor industry terms used here.)

    Losers

  • TSMC: As the world’s biggest and most important chip foundry, the Taiwanese tariffs will hit TSMC hard. Their U.S. fab in Arizona isn’t ready for production yet, so all their chips will (theoretically) get hit with tariffs, assuming Trump doesn’t grant them a waiver because they’re already constructing a plant. But if they do go into effect, possibly even more heavily impacted will be:
  • TSMC customers, including Apple, Nvidia and AMD. All three get their very highest-end, cutting edge, sub-10nm chips fabbed there. For Apple, the M-series and A-series chips made there form the heart of all their Macs and iPhones. Likewise, Nvidia gets its highest end GPU/AI/etc. chips fabbed by TSMC. AMD’s most powerful CPU’s are also fabbed by TSMC, though some lower end chips are made elsewhere (like GlobalFoundries).
  • Tokyo Electron: Japan’s biggest semiconductor equipment manufacturer assembles pretty much all their equipment in their home country. 24% tariffs may make their equipment uneconomical compared to rivals Applied Materials and LAM Research.
  • South Korean DRAM manufacturers Samsung and SK Hynix: 25% tariffs will definitely impact sales in a market segment whose overall margins (robust in booms, and barely breaking even during busts) are thinner than others.
  • Every American electronics company that uses DRAM. Which is pretty much every American electronics company.
  • Every American AI boom company. Their data center costs are going up, while those of their foreign competitors are not.
  • Korean flat panel display manufacturers Samsung and LG Semicon, who between them control over 50% of the market.
  • Every American TV and monitor manufacturer, the vast majority of which have their devices manufactured overseas.
  • UMC: They’d fallen woefully behind TSMC for foundry work, and they won’t be winning much additional American business now.
  • Every company trying to build a sub-10nm fab in the U.S., as steppers from Netherlands-based ASML just got more expensive and the competition to obtain them might have increased.
  • Pretty much every fab in China just got more screwed…but they were pretty screwed (and trailing badly) before.
  • American fabless chip startups: Their costs for getting chips to market probably increased.

    • Winners

  • Applied Materials, LAM Research and KLA Tencor. Buying competing Tokyo Electron equipment just got more expensive, and a bunch of companies now have incentives to build fabs in America.
  • Intel: Assuming they’ve finally got their process technology sorted out (a big if), they’re well-positioned to take CPU market share from AMD and to grow their under-performing foundry business.
  • Micron (sort of): As the only American DRAM manufacturer, they can probably earn more per each chip produced domestically. But Micron has a lot of overseas fabs these days, and building new domestic DRAM fabs will take years.
  • GlobalFoundries: The costs of their global competitors just increased, so they can probably win more business for their domestic foundries…if they have the available wafer starts. But they have a lot of foreign fabs as well.
  • Samsung‘s US foundry business. Presumably the wafer starts for their Austin and Taylor fabs will see increased demand.
  • Maybe Texas Instruments, but I’m not sure how much mixed-signal and analog competition they have, and that’s their bread and butter.

    • Neutral

  • ASML: Being in the Netherlands and having TSMC as their biggest customer, you figure they’d be hurt, but no. You can’t get EUV steppers from anyone else, and I get the impression they’re building EUV steppers as fast as they possibly can already. Anyone building a cutting-edge fab will just have to pay more to get them.
  • Tower Semiconductor: Half their foundries are in Israel and half in the U.S., so I figure it’s a wash.

    • That’s my quick and dirty analysis. Of course, Trump is using tariffs like a battering ram to smash foreign tariffs, and if he’s immediately successful, there probably will only be minor hiccups in the global supply chain. But if not, a whole lot of disruption might lie ahead, and it usually takes a minimum of 3-5 years to bring a new fab online.

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    Posted in Austin, Economics, Foreign Policy, Texas | 6 Comments »

    Why Commies Couldn’t Do Semiconductors

    Sunday, January 15th, 2023

    Asianometry has an interesting video up about East Germany expensive, strenuous efforts to catch up to the west in semiconductor manufacturing technology.

    Spoiler: They didn’t.

    Some takeaways:

  • “In the late 1980s, the German Democratic Republic, or East Germany, went all in on the monumental task of domestic semiconductor production. This semiconductor obsession failed, and the billions of marks spent on it eventually bankrupted the country’s failing economy.” I think he oversells the role the semiconductor push had on bankrupting the economy; everything in late commie East Germany was failing (just like the rest of the Warsaw Pact), they suffered a credit crunch for investment due to tightened western restrictions, couldn’t export Soviet oil as profitably due to the Reagan/Saudi created oil glut, and also were running into hard currency shortages to but the components their manufacturing sector needed to keep exporting.

  • The East German Uprising of 1953 kicked off what would be a persistent, and ultimately existential problem, for the GDR: Emigration. Throughout its history, its best and smartest people consistently sought a way out to the West. To convince its people to stay, the SED [Sozialistische Einheitspartei Deutschlands, AKA Socialist Unity Party of Germany] promised a better future through the use of technology. More than the Soviets, East Germany leaned on information technology as a pathway towards economic vitality and a glorious socialist future. The Party’s elites saw themselves locked in a technology race with the capitalists to see who can build a better society. Leader Walter Ulbricht called for an “industrial transformation” with the ultimate aim of “catching up with and surpassing capitalism in terms of technology.” A thriving computer industry was crucial towards making this ideology work. And in order to produce these superior computers, East Germany needed to learn and master microelectronics technology.

  • “Less than four years after the Americans invented the germanium transistor, East Germany moved quickly to build their own line of first generation semiconductors. In 1952, development work began at the VEB Works for Electrical Components for Communications Technology, or WBN, in the town of Teltow near the city of Berlin. This put them about even with West Germany. The FRG’s first semiconductor factory came about in 1952, built by Siemens.” Indeed, this is very early to get into the semiconductor game. It wasn’t until 1957 that Fairchild Semiconductor, widely considered as Company Zero for America’s semiconductor industry, was founded.
  • “WBN suffered from a lack of cooperation between its industrial and academic sides. The production teams lacked discipline, hands-on experience, and did not appreciate the scale and difficulty of the task they were facing. In one incident, the team dumped hot ashes right outside a factory window where they were producing a pilot run of semiconductors.” Ouch! A very uncleanroom…
  • “The state failed to give their young semiconductor team the resources it should have gotten. Administration – their chief accountant, in particular – seemed to care very little for semiconductors. When the team asked for money to purchase felt slippers to prevent static charge buildup in the clean room, their chief accountant denied the request.”
  • The Soviets didn’t help. “Despite being the GDR’s primary political backer, the Soviets were strangely wary. In 1958, two WBN staff members traveled to the Soviet Union to do technical exchanges. A year later, they came back complaining of limited cooperation. Much of what the Soviets had developed was created for military use. Thusly, the Soviets were concerned that transferring that to the East Germans would leak via scientists defecting to the West.”
  • They tried to get information from the U.S., but Cold War tech transfer policies were already falling into place. They had better luck in the UK. “Through the contacts of Arthur Lewis, a British Labour Party politician, the delegation saw plants owned by British Philips, Siemens-Edison, and British-Thompson-Houston. The latter is a descendant of the Vickers Company that sold oil equipment to the Soviets in the early 1900s. Just thought that was a nice connection. This visit was very successful. The East Germans learned a whole lot about industrial level semiconductor manufacturing. They even managed to purchase equipment for low-frequency transistors, a trailing edge technology.”
  • Despite that, the gap grew wider: “In 1958, WBN produced 100,000 germanium diodes, transistors, and rectifiers. Worse yet, some 98% of what they produced eventually needed to be discarded throughout their entire working lives.” Classic commie quality. “That same year in 1958, the United States alone produced 27.8 million transistors. Two years later in 1960, the US grew that production capacity five times over to 131 million.”
  • “Erich Apel, head of the Economic Commission of the Central Committee Politburo and an economic reformer – wrote in late April 1959: ‘Compared to … the American, Japanese, and West German industry, we lie in a state of backwardness that can scarcely be estimated … this backwardness will not decrease through 1961 at least, but will instead grow. Another inspection in 1960 identified more items of backwardness in semiconductor production. Workers tended to use rules of thumb rather than their instruments to measure. The various factory lines did not cooperate with one another.”
  • “Interestingly, when reporting these results to the Economic Commission of the Central Committee Politburo, that inspector softened his results. In his notes to state authorities, he said the GDR was 5 to 6 years behind. But in his analysis to the more politically charged Economic Commission, he cut it in half, 3 to 4 years.” Commies always institute thermoclines of truth to avoid being purged.
  • The brain drain to the west continued. The solution: The Berlin Wall. “For semiconductors however, the Wall pinched off what little technology the GDR had imported from the West.” The solution was to suck up even more to the Soviets, and to spy harder.

  • In 1963, the aging Walter Ulbricht launched a new initiative – called the New Economy System of Planning – to bring more market elements to the GDR economy. Now industrial groups, not bureaucrats, can actually decide how money can be spent. The reform also elevated the status of technology sectors like semiconductor manufacturing in the economy. R&D spending increased by over a third from 1959 to 1963. In 1965, nearly 40% of the electronics that the GDR produced by value were semiconductors – 82 million marks out of 223 million marks in total. Four years later in 1969, that number grew four-fold. Many of these transistors went into new consumer technical goods like radios, TVs and fridges. In 1971, semiconductor production reached 535 million marks by value. That year, East Germany began producing their first integrated circuits, some 10 years after Texas Instruments did it.

  • “Strange inequalities in policy planning meant that color televisions were widely available, but consumer items like toothbrushes and toilet paper were in short supply.” Communist planning at its finest!

  • One day in 1967, the Minister of Electrical Engineering and Electronics showed up to an East German electronics firm with a suitcase full of integrated circuits from TI. He told them to copy them exactly. The Ministry for State Security – better known as the Stasi – had been engaged in scientific and technology espionage since the 1950s – mostly related to atomic engineering and other sciences. Then in 1969, the Stasi’s Scientific and Technical Sector was reorganized and expanded with the goal of acquiring military technologies. After Honecker came into power in 1971, the Stasi’s job shifted from acquiring scientific knowledge to specific technologies – mostly via informants in the West who found and handed the goods over to East Germany. One such informant was Hans Rehder, a physicist working for the West German firms Telefunken and AEG. He handed over technical secrets for over 28 years and was never caught.

  • “Western companies knew about this copying of course. In one famous example, a GDR chip analyst looking at a stolen chip from the US firm Digital Corporation saw a message n Russian, roughly translating to: ‘When do you want to stop to swipe. Own design is better.'”
  • Stasi intellectual theft kept them from falling further behind, but couldn’t close the gap. “Because the Stasi were spymasters not technical experts, they frequently asked for the wrong item. Their methods of laundering the technology before passing it on made it harder to understand how to use it. Tightening embargoes from the West also interfered with industrial development. Stolen Western products got progressively older and more expensive to acquire. The embargoes gave other countries the chance to scam the Stasi, adding mark-ups frequently in the range of 30% to 80% to even 100%. This drained the East Germans’ already limited R&D budgets.”
  • “The wholesale copying also undercut the country’s ability to export its goods abroad. The Stasi did not want other countries to see what they had managed to acquire. And had they tried anyway, sales would have been blocked on patent infringement grounds. And finally, semiconductors were getting to the point that East German technicians struggled to replicate them. As early as 1976, an IC’s physical form no longer yielded secrets on how to produce them.”
  • “In 1981, with the GDR still about 7-10 years behind the West in microelectronics development, Erich Honecker announced a ten-point program to produce the majority of its semiconductors domestically by 1985. The 1970s were rough years for the GDR. Tighter export bans. The Oil Crises of the 1970s. Heavy borrowing from the West. Declining productivity and worsening competitiveness. It was all weighing heavily – grinding the country’s economy to a halt. Gerhard Schürer, head of the State Planning Commission, convinced Honecker that investing in semiconductors would bring the country out of its economic morass.”
  • They even struck a deal with Toshiba.

    In exchange for 25 million marks, Toshiba – a long running technology  partner with the GDR – would furnish the GDR with designs for their 256 kilobyte memory chips along with instructions on how to produce them. At the time, 256-kilobyte was leading edge stuff. The GDR was still struggling to produce 64 kilobyte memory. This would have been a game-changer. But in 1987, Toshiba got caught selling submarine propeller equipment to the Soviet Union. Huge scandal back then. Afraid of getting caught again, Toshiba offered the Stasi a 95% refund to destroy the evidence. [Spy Gerhardt] Ronneberger agreed. So in July 1988, he got the money back and dissolved the chip designs in a vat of acid in front of Toshiba’s people. But never trust a spy! Those were just copies, produced for exactly that purpose.

  • Finally in September 1988, Zeiss General Director Wolfgang Biermann triumphantly presented Erich Honecker with the first samples of that 1 megabit chip – the U61000. Honecker said that the chips were “convincing proof that the GDR is maintaining its position as a developed industrial country.” This technical “triumph” was the bitterest of them all. In semiconductors, prototypes mean nothing. Production means everything. Dresden produced just 35,000 chips throughout the entirety of 1988 and 1989 with a yield of 20%.

    To say this was “piss poor” would be an understatement. Those are ruinous, “fire everyone” numbers for actual semiconductor manufacturers.

    They planned to scale up to 100,000 1 megabit chips each year. Toshiba alone produced that many in a single day. Two months later in November 1988, the leading edge moved once more. Toshiba began shipping its 4-megabit DRAM in high volume, seeking to produce a million chips a month by March 1989.

  • Then history happened. “By then, the East German economy was in shambles,  scheduled to default on its debts by early 1990. It never even got there. In May 1989, Hungary opened its borders with Austria and East Germans swarmed through there en route to West Germany. Later in November 1989, a year after its one megabit technical triumph, the Berlin Wall fell.”

    • East Germany stole as many designs as they possibly could, but they couldn’t steal the intellectual expertise behind the numerous process tweaks, nor the furious swarm of technological innovation drive by Silicon Valley’s capitalist high risk/high reword startup culture that drove Moore’s Law for decades.

    Top-down communist command economies never had a chance to keep up.

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    Posted in Communism, Economics, video | 4 Comments »