Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

U.S. government takes 10% stake in Intel

cnbc.com

Post reply on HN
Print view View original

691–700 of 765 posts

Re: U.S. government takes 10% stake in Intel

#691

Post by thisisit »

azinman2 wrote: post #687
thisisit wrote: post #628

Earlier quoted context omitted.

Government shouldn't bail out anyone. Period. It should enact preferential policies like grants, tax cuts, subsidies etc. for industries they want to promote. It is done all the time. That is what happened with the CHIPS Act. The moment 10% stake was announced this became political. While the stated reason might be national security etc, in reality something else might be at play. One, this government and its support…

Except if Intel goes there’s no leading chip manufacturer left. You can’t just (easily) tax cut your way to having that concentrated knowledge and market position.

It's like you intentionally chose the ignore other government actions and focus on taxes just to fit your narrative. Read it again:

> It should enact preferential policies like grants, tax cuts, subsidies etc. for industries they want to promote.

And read the announcement again. Intel has not been given extra money. CHIPS Act money has been converted to stake. That means Intel wasn't going away, if that is your concern.

Government routinely provides grants or preferential treatments to certain sectors or industries. Like Tesla and the EV grant. That works fine. It doesn't mean government needs to acquire stake in Tesla and put their thumb on the market scale.

In case you miss it, let me repeat - industries needs to be supported. It is called CHIPS Act not Intel Act for a reason. Given the current POTUS propensity to hold aid/grant without a quid pro quo, we can guess what happened here. Intel doesn't gets the grant money unless they kiss the ring and polish POTUS' image.

Re: U.S. government takes 10% stake in Intel

#692

Post by azinman2 »

thisisit wrote: post #691
azinman2 wrote: post #687

Earlier quoted context omitted.

Except if Intel goes there’s no leading chip manufacturer left. You can’t just (easily) tax cut your way to having that concentrated knowledge and market position.

It's like you intentionally chose the ignore other government actions and focus on taxes just to fit your narrative. Read it again: > It should enact preferential policies like grants, tax cuts, subsidies etc. for industries they want to promote. And read the announcement again. Intel has not been given extra money. CHIPS Act money has been converted to stake. That means Intel wasn't going away, if that is your conce…

“Please respond to the strongest plausible interpretation of what someone says, not a weaker one that's easier to criticize. Assume good faith.”

I’d encourage you to “read again” the HN guidelines.

> Government shouldn't bail out anyone. Period. It should enact preferential policies like grants, tax cuts, subsidies etc. for industries they want to promote.

If Intel is at risk of going under, saving it is what’s understood to be “bailing out.” A grant that’s meant to save a major multi-billion dollar company isn’t quite what most people think of as a grant.

Re: U.S. government takes 10% stake in Intel

#693

Post by woleium »

tw04 wrote: post #684
ch4s3 wrote: post #273

Earlier quoted context omitted.

I’d really rather we didn’t bail out these companies at all. It clearly creates moral hazard and makes it hard for better run companies to enter markets.

While that argument makes sense from a purely philosophical perspective, it doesn’t hold water in the reality of this situation. Nobody is entering the chip making business and growing to a size and scale to compete with Intel in 2025. If they collapse tomorrow there aren’t going to be startups filling in the gaps, there’s just going to be massive shortages of chips and chaos.

You are saying that if intel went under, Musk or some other wouldn’t buy the assets and have a go?

Re: U.S. government takes 10% stake in Intel

#694

Post by re-thc »

frollogaston wrote: post #561
bcrosby95 wrote: post #346

Earlier quoted context omitted.

If shareholders are losing ownership it's less a pure bailout and more a strategic investment and/or takeover. It also potentially lets the average taxpayer benefit rather than just those its directly propping up.

They aren't really losing ownership, they sold ownership at market rate.

> they sold ownership at market rate

No, they did not. The government paid less than Softbank that also just purchased a stake. Unless forced, Intel could have likely gotten a better deal.

Re: U.S. government takes 10% stake in Intel

#695

Post by alephnerd »

bigyabai wrote: post #551
selimthegrim wrote: post #360

Earlier quoted context omitted.

What’s your suggested remedy?

Deregulate RISC-V, threaten Intel with loss of IP if they can't profit on fabs, threaten to cut Softbank off of American companies if Masayoshi Son won't onshore RISC manufacturing. There's soft-power coercion left on the table, the only thing we buy with Intel stock is a C-suite's dinner bill.

> Deregulate RISC-V

What does that even mean?!?

It's already OSS and royalty free. I've participated Series A and B rounds on startups working on RISC-V design.

> threaten Intel with loss of IP if they can't profit on fabs

Investing in Capex is inherently going to put you in a loss for several quarters

> threaten to cut Softbank off of American companies if Masayoshi Son won't onshore RISC manufacturing

He doesn't own RISC-V IP.

-------

This is why I hate HN now. ICs with no domain expertise think they should have a voice.

Re: U.S. government takes 10% stake in Intel

#696

Post by tw04 »

woleium wrote: post #693
tw04 wrote: post #684

Earlier quoted context omitted.

While that argument makes sense from a purely philosophical perspective, it doesn’t hold water in the reality of this situation. Nobody is entering the chip making business and growing to a size and scale to compete with Intel in 2025. If they collapse tomorrow there aren’t going to be startups filling in the gaps, there’s just going to be massive shortages of chips and chaos.

You are saying that if intel went under, Musk or some other wouldn’t buy the assets and have a go?

...no? Did you see me say nobody would buy the assets in a scenario where Intel was actually going bankrupt?

I said if by some magic Intel ceased to exist tomorrow, there wouldn't be some startup just filling the gap. So the idea that government investment in Intel somehow prevents a startup competitor is just nonsense. To compete with Intel would require trillions in investment and probably a decade+ of time to build the requisite organization and talent.

The government investment to prevent the catastrophe that would result in them declaring bankruptcy and the subsequent breakup of their assets has no bearing on whether or not a startup could replace them.

Re: U.S. government takes 10% stake in Intel

#697

Post by parineum »

Nemo_bis wrote: post #640
parineum wrote: post #364

Earlier quoted context omitted.

> Capitalism for profits, socialism for losses. I’m sick of seeing this sort of behavior pan out time and time again, though I’m hardly surprised by it at this point I'm not sure how this applies. The US government just gained a 10% stake for nothing (that wasn't already given). Effectively going from the scenario you are painting to now taking a part of the profit as well. I guess you were surprised after all!

The whole point of equity is that it can go to zero. Profit sharing means that the government had an upside (if Intel became profitable) and no downside. Now, if Intel loses money or goes bankrupt, 10 % of those losses automatically get socialised.

Great explanation of the socialism for losses, which was already happening and is the normal bailout routine.

Now explain how "Capitalism for profits" applies.

Re: U.S. government takes 10% stake in Intel

#698

Post by alephnerd »

lazide wrote: post #31
alephnerd wrote: post #23

Earlier quoted context omitted.

And fundamentally, I believe that any industrial stimulus should come with a mixture of government ownership as well as claw-back provisions should interests contravene national security. Edit: cannot reply to you. This deal literally comes with claw-back provisions.

and does any of that seem to have anything to do with the current deal, or align with current legislation? Or is it just a transparent shakedown?

The current deal comes with claw-back provisions, but I am more interested in the precedent it sets.

This plus the CHIPS+IRA has now set the precedent for states and the federal government to build an SDF. I don't trust this administration aside from a couple staffers, but this allows us in a post-Trump era to build SDFs and return to the industrial policy norms we had in the US before the 1980s with Reaganomics.

CHIPS and IRA themselves were able to be pushed by the Biden admin becuase Trump 1 set the precedent to ignore traditional norms.

Re: U.S. government takes 10% stake in Intel

#699

Post by badpun »

Auracle wrote: post #619
iammrpayments wrote: post #327

Earlier quoted context omitted.

Is like the country is not already collapsing due to lack of social services compared to the supposed enemy which already has higher lifespan while having 10x lower gdp per capita.

The US is not “collapsing” and we have plenty of social services. Our lifespan is lower because we’re fat.

Isn't that because of deaths of despair, namely by drugs? Why are there so many desperate people in the US if the country is doing ok?

Re: U.S. government takes 10% stake in Intel

#700

Post by bink »

rpmisms wrote: post #543
bink wrote: post #305

Earlier quoted context omitted.

We aren't anywhere close to being in a depression though. What extraordinary situation requires the government to take a stake in a public company and under what conditions will this position be liquidated?

We are very close to being in a depression. Most of our money has nothing to do with actually feeding or housing people. If the wrong thing shifts, we're toast.

The unemployment rate is still near historic lows and while new job numbers are getting worse they're still positive overall. We aren't anywhere close to being in a depression currently.
Post reply on HN