Earlier quoted context omitted.
You mean did insider trading?
yes :) ,i got the terms mixed up.
Probably enough to lead to meaningful indictments and convictions, which will never happen.
U.S. government takes 10% stake in Intel
221–230 of 765 posts
Re: U.S. government takes 10% stake in Intel
#222Earlier quoted context omitted.
I think a better rephrasing is "government is giving $8.9B from the CHIPS act in exchange for a 10% stake in the company"
Depends on who you ask. Trump himself seems to think the US is getting 10% for free. I think that's a fair assessment given that these grants were already supposed to be paid out to Intel, without any kind of equity stake promised. Worth noting that Intel is the only company that had these kinds of shenanigans pulled with their grant. Samsung, TSMC, Micron and others were granted similar funds without any kind of wit…
> Worth noting that Intel is the only company that had these kinds of shenanigans pulled with their grant.
Sure, but Intel's new CEO is making a lot of noise that indicates that Intel is maybe not going to be able/willing to build some-to-many of the things the CHIPS money paid for.
Giving FedGov a 10% stake in the company [0] is better than taking the money back for nonperformance, wouldn't you say?
[0] Which -as I understand it- was the sort of thing that was done for those finance companies that were Too Big To Fail when all that fraud^W novel financial engineering eventually caught up to them.
Re: U.S. government takes 10% stake in Intel
#223Earlier quoted context omitted.
Isn't that pretty bad, Darth Vader style changing of previously agreed on deals ? Not sure how anyone can believe anything that was agreed will hold in such an environment. :P
That's precisely how private citizen Trump ran his businesses as well. Make an agreement with contractors to get work started knowing full well those agreements were never going to be honored. Instead, refuse to pay anything forcing contractors to renegotiate at much worse terms vs not getting anything at all. The whole time banking on these contractors not willing to fight in court. That was the art of the deal
The art of the deal isn't a deal. It's extortion.
Re: U.S. government takes 10% stake in Intel
#224Ironic, Western politicians thought opening up to trade with China would lead to it adopting a Western model of government. Instead it's lead to the USA adopting the Chinese one.
It’s not “adopting” the Chinese model yet, so much as incoherently copying bits and pieces. If you want to run effective industrial policy you need sufficient state capacity and an army of technocrats who are experts on industrial policy. Trump’s second term performance gives no hope on both fronts.
Re: U.S. government takes 10% stake in Intel
#225A lot of people are commenting on this without reading the actual content of the deal, which is spelled out in Intel's press release: https://www.intc.com/news-events/press-releases/detail/1748/...
Re: U.S. government takes 10% stake in Intel
#226I've lived long enough to see the Republicans become the socialist party
It's also pretty nationalist.
Re: U.S. government takes 10% stake in Intel
#227Earlier quoted context omitted.
The answer is in the paragraph in between the two you quoted from. The money for the purchase has already been appropriated by Congress and awarded to Intel. The awards didn't previously have this giant string attached where Intel gives stock in return. But now they do. And it makes sense that Intel is spinning it as a generous investment from the gov't, but the gov't is spinning it as a free gift from Intel. Neither…
I had seen that, but I don't consider that "paying nothing". That's paying something. I'm also confused how it's a "grant" if it's completely transactional. That's not a string attached, that's just a purchase. So I guess it's just political spin on all sides.
The thing you're missing is that it was different administrations offering the grant vs the "investment".
Re: U.S. government takes 10% stake in Intel
#228Ironic, Western politicians thought opening up to trade with China would lead to it adopting a Western model of government. Instead it's lead to the USA adopting the Chinese one.
We even have no assurance of keeping private property via civil asset forfeiture! Private ownership was the adults main point of pride to distinguish from the Chinese when I was growing up. And now the Chinese private property frameworks are closer to ours and ours are closer to theirs.
Civil forfeiture existed since 1660s, and was used initially to confiscate smugglers' vessels. Then it was dug out during Prohibition, and turned toxic in 1980s when the agencies doing the forfeiture (e.g. police) were allowed to keep the confiscated property. Ideally it should be used for restitution (e.g. to victims of fraud), but...
I suspect you were growing up when this was in full swing already.
Re: U.S. government takes 10% stake in Intel
#229Earlier quoted context omitted.
It's effectively a grant. The US government isn't buying existing shares. Intel is issuing new shares and selling them to the US government - so actual money is being transferred to Intel (and existing shares are being diluted as a result).
That's just buying stocks (at-the-market offering).
Nope.
When I buy stocks at market price, the company gets none of my money.
When the company issues new stocks and sells them, the company gets the money.
Re: U.S. government takes 10% stake in Intel
#230> the government made an $8.9 billion investment in Intel common stock, purchasing 433.3 million shares at a price of $20.47 per share, giving it a 10% stake in the company
> Of the total, $5.7 billion of the government funds will come from grants under the CHIPS Act that had been awarded but not paid, and $3.2 billion will come from separate government awards under a program to make secure chips
Interesting accounting there. I guess the government was threatening to void the grants or something? Why would Intel donate shares for grants already approved?
I guess this nets out to a stock issuance with no downward price pressure, so still not a bad trade for Intel if they thought those grants were worth nothing.