How is Chipageddon affecting you?

[Bud]

I am not sure I buy that hoarding theory. Chips are not like wine which gets better with time, they become obsolete.

[Bassman59]

I am not sure I buy that hoarding theory. Chips are not like wine which gets better with time, they become obsolete.

If you buy 50 $1 chips and try to sell them for $50 each, all you need to do is sell two of them to be in the bonus. You can toss the remaining 48.

[thinkfat]

I am not sure I buy that hoarding theory. Chips are not like wine which gets better with time, they become obsolete.

If you buy 50 $1 chips and try to sell them for $50 each, all you need to do is sell two of them to be in the bonus. You can toss the remaining 48.

But you'd never, because you're greedy.

[PlainName]

To have this kind of effect on availability, you'd need to hoard an awful lot of stuff. Even at original prices that's a massive amount of money. Unless... maybe if you could get it on 120-day terms or something, and then assume you can sell on for original pricing, or slight loss, if the apocalypse doesn't turn up.

[JPortici]

I ordered STM32F373 microcontroller's from Mouser in February 2021 and on website before ordering estimated delivery was 52 weeks but after ordering there was no date just "Will advise*"
Then in December 2021 they asked if I'm OK with a price increase from $4.07 to $4.61  (Canadian dollars). But there was still no delivery date estimate.
Then in April 2022 they again asked me to accept a price increase now form $4.61 to $5.25 still no delivery estimate.
I guess this will not be the last price increase and not sure I will ever get them so I will need to find them on the black market at multiple time the cost and with good chances to get fake parts. I say this I already got a batch where about 60% of the microcontrollers where fake (some other components with same footprint and laser etched the part number I ordered). I build a set of boards and then needed to manually desolder the fake microcontrollers and solder the non-fake ones. After I knew there were fake parts combined with good but old parts I was able to visually identify the fake parts and remove.
There are many other parts that I ordered and will be delivered at end of year and next year but at least there is a date tho in two cases the date was pushed back a few times so not better than the microcontroller (some Toshiba mosfets).
And is not just semiconductors even things like connectors (2.5mm pin pitch Phoenix) are not in stock with delivery estimates around the end of the year.

I do not think there will be improvements anytime soon and things may get even worse.
I know when checking the stocks for mosfets (power mosfets) there was some alternative stock even if limited so I could have changed my design last year but looking now at both Mouser and Digikey there is basically zero stock even for alternative's.
And I can not get alternatives for some parts like the Microcontroller as that will mean likely many months of hardware and software changes.

My understanding is that demand of semiconductor's is much higher than supply but not quite sure why that happened so sudden.   

But that's not mouser. That's ST unilaterally increasing prices without providing shipping dates because there are none. Unfortunately they can do that, it's somewhere in their contract, mouser wouldn't want to stop getting ST parts altogether....

Ah, i miss the good times when if there was rumor of ST not having stuff for apple or bosch the stock would tage a big dip so you could buy some.

[SilverSolder]

I am not sure I buy that hoarding theory. Chips are not like wine which gets better with time, they become obsolete.

Well, I know people that are being offered more for their used cars than they paid for them new originally...    inflation is a crazy thing.

Another interesting factlet is that the way we measure inflation has been changed over the years...   if we still measured inflation the same way it was done in 1990 or 1980, the headline inflation number would be significantly higher today!

[jeremy]

Looks like you need to log in on TI.com in order to view inventories and lead times now. I guess that is so they can offer different inventories/lead times to different classes of customer?

[tom66]

During times of high inflation, it makes sense to invest your money in goods...   that can be sold later, in exchange for a larger amount of less valuable currency.

During this cycle, a lot of clever people have been buying things up for resale later.

All of the stuff we can't get now, will magically reappear at a higher price later,  just wait and see.

Or, it could end up like some of those people who bought bulk stock of hand sanitiser during the pandemic and then suddenly found they couldn't sell it because the supply did in fact pick up.

I personally would love to see this reality happen to a lot of the scalpers.

[PaulAm]

Ha!  A local university was recently selling excess masks for $1/CASE and $15 for 55 gal drums of hand sanitizer.

If only that were true for semiconductors.

[Bassman59]

I am not sure I buy that hoarding theory. Chips are not like wine which gets better with time, they become obsolete.

Well, I know people that are being offered more for their used cars than they paid for them new originally...    inflation is a crazy thing.

That's not inflation. That's the price of insufficient supply rising to meet demand.

And, face it, most of the price rises we are seeing across the board aren't the result of inflation. How can we tell? When we see corporate earnings greatly increased year over year while seeing retail prices rise, that's not inflation. That's greed.

[TimFox]

I am not sure I buy that hoarding theory. Chips are not like wine which gets better with time, they become obsolete.

Well, I know people that are being offered more for their used cars than they paid for them new originally...    inflation is a crazy thing.

That's not inflation. That's the price of insufficient supply rising to meet demand.

And, face it, most of the price rises we are seeing across the board aren't the result of inflation. How can we tell? When we see corporate earnings greatly increased year over year while seeing retail prices rise, that's not inflation. That's greed.

Inflation is defined as a general rise in prices.
"In economics, inflation is a general increase in the prices of goods and services in an economy.  When the general price level rises, each unit of currency buys fewer goods and services; consequently, inflation corresponds to a reduction in the purchasing power of money." from Wikipedia, and other dictionary sources. 
see  https://en.wikipedia.org/wiki/Inflation

There are several causes of inflation in economics, but the effect is a rise in retail (and other) prices.

[jrs45]

I am not sure I buy that hoarding theory. Chips are not like wine which gets better with time, they become obsolete.

Well, I know people that are being offered more for their used cars than they paid for them new originally...    inflation is a crazy thing.

That's not inflation. That's the price of insufficient supply rising to meet demand.

And, face it, most of the price rises we are seeing across the board aren't the result of inflation. How can we tell? When we see corporate earnings greatly increased year over year while seeing retail prices rise, that's not inflation. That's greed.

That's not correct at all.  They're no greedier now than in the past.

If corporate earnings rise while prices rise, that's also consistent with inflation.  Those dollars are worth a lot less, whether they are for buying products or taking profits. 

I don't know how one can expect to print trillions of dollars and not expect skyrocketing inflation.  It's inevitable.

[MT]

[Kasper]

[...]that's not inflation. That's greed.

I'm pretty sure greed is usually the cause of inflation.

[Kasper]

How many of you remember the shortages around 2018?  Every time I did a build I had to find alternatives for about 1/3 of my 0402 and 0603 caps and some resistors too.  That seems like nothing compared to the problems now.  Back then I could find replacements.  It was tedious but didn't delay any builds.

Here is an article about shortages in 2018 with a neat graph in it.
https://www.tti.com/content/ttiinc/en/resources/marketeye/categories/passives/me-zogbi-20180930.html

[IDEngineer]

I'm pretty sure greed is usually the cause of inflation.

Nope, but that's what the politicians want you to believe! Inflation is really an increase in the money supply per unit of economic activity. Roughly like (MoneySupply/EconomicActivityLevel). The most common cause to drive that equation positive, meaning INflation (though not the only possible one), is wildly adding too many new dollars when the underlying economic activity does not also rise accordingly. This means all dollars in circulation are each worth less.

Please note I'm not saying increasing the money supply is bad. If the economy actually grows, it makes sense to "print more dollars" if your goal is to keep each dollar worth the same effective purchasing power.

However, that is NOT what is happening. What we're seeing today is the end game of decades of irresponsible government behavior. First the huge bailouts of the 2007-2009 era (the "Great Recession") where economic activity was flat or declining, yet gobs of new dollars were tossed into the market for political reasons. No politician wanted to fall on his sword to vacuum those dollars back out of the economy later, so the ratio began to swing... but the politicians also pressured the Fed to keep interest rates ridiculously low to artificially prop up the economy rather than let market forces naturally absorb those new dollars and have inflation gently accommodate them over a period of time.

This has continued until COVID-19, the straw that broke the camel's back. Once again, economic activity dropped yet they responded by throwing record amounts of unbacked dollars into the economy. There are delays in the system, so the sugar high felt great for a short time, but all that pressure has been building... and now instead of graceful accommodation over long periods of time, the natural laws of economics are reasserting themselves. The money-printing binge of yesterday becomes the pimple you pop, the mirror you clean, tomorrow.

The imbalance has become too great. The Fed cannot keep rates close to zero any more. And again, no politician is willing to sacrifice their career to do the correct thing and suggest pulling those dollars back out so the ratio of dollars to economic activity is roughly at parity again. Greed - at least economic greed by companies, which is what I believe you were implying (if I'm wrong, I apologize but I hear this from a lot of people lately) - is not the cause of inflation and corporations have no way to influence the money supply. If someone thinks they can "just raise prices to gouge people" someone else in the market will be glad to steal their customers. Except that isn't happening because the corporations are stuck in the same situation as everyone else. Their costs are rising too. Generally speaking nobody can radically undercut the other guy's "robber baron pricing" because that pricing is driven by actual cost increases.

I'm sure there are some edge cases out there. But this is reality for the vast majority. And it all comes down to too many dollars for the level of economic activity. Hey, if you WANT to devalue your currency, have at it. Venezuela offers the most recent example but they're far from the first and won't be the last. But if you want responsible economic policy, you seek to avoid wild gyrations like this by allowing normal market forces to see cyclic ups and downs along the way, none of which are so extreme that they end up being given historic names with leading capital letters. When this happens, it's a failure of your politicians, period.

[SilverSolder]

The last time this happened (1970s) the inflation genie was only put back in its bottle when Paul Volcker increase interest rates to crazy levels in the 1980s to rescue the economy.

After that shock treatment, politicians behaved themselves better for several decades - but gradually, they found it harder and harder to resist pushing the envelope, and here we are.

Now, we are stuck between a rock and a hard place...  and it is a good question if Jerome Powell will be able to rein this mess in without major pain...

[tom66]

Interestingly enough the reason for the 0402 and 0603 shortages was because they were so unprofitable that Murata, TDK, etc. had not expanded capacity because it just wasn't proving profitable enough to sell caps.  The environment was too competitive, as one FAE told me.  They were focusing on the 1206 and bigger parts.

It's kind of ironic that the opposite problem is true for semiconductors:  extremely profitable, but with such high capital costs that building new fabs is difficult.

[Kasper]

I'm pretty sure greed is usually the cause of inflation.

Nope, but that's what the politicians want you to believe! .
[...]
Greed - at least economic greed by companies, which is what I believe you were implying (if I'm wrong, I apologize but I hear this from a lot of people lately) - is not the cause of inflation and corporations have no way to influence the money supply.

I'm saying the people who have the most control on inflation cause inflation because they are greedy. 

The fed, the bankers, the government, the big corporations and their lobbyists have the most control. 

Inflation increases asset values, reduces the impact of debt and reduces the value of wages.  I think the people with the most control are usually in positions that profit off these things. 

[rsjsouza]

The last time this happened (1970s) the inflation genie was only put back in its bottle when Paul Volcker increase interest rates to crazy levels in the 1980s to rescue the economy.

Yes... The infamous "prime rate" of the 1980s sucking the monetary air of the world and leaving crumbles of investment money to the developing countries with naturally higher risk. Although we had our own immense incompetency in running our own country (mentioned in this interesting article), the thugs from IMF also tried to impose all sorts of crazy austerity policies that were shown a few years later to be vicariously damning to the population with very little effect in curbing the problem.

The cautionary tale for the US of yesterday and today is mentioned in the article, where things were still "good" with an inflation of only 500% a year when it was written (it peaked at more than 2000% a year between 1988 and 1993). Brazilians call this period the "lost decade".

[TimFox]

The last time this happened (1970s) the inflation genie was only put back in its bottle when Paul Volcker increase interest rates to crazy levels in the 1980s to rescue the economy.

Yes... The infamous "prime rate" of the 1980s sucking the monetary air of the world and leaving crumbles of investment money to the developing countries with naturally higher risk. Although we had our own immense incompetency in running our own country (mentioned in this interesting article), the thugs from IMF also tried to impose all sorts of crazy austerity policies that were shown a few years later to be vicariously damning to the population with very little effect in curbing the problem.

The cautionary tale for the US of yesterday and today is mentioned in the article, where things were still "good" with an inflation of only 500% a year when it was written (it peaked at more than 2000% a year between 1988 and 1993). Brazilians call this period the "lost decade".

The extreme interest rates under Volcker had the side effect of increasing the value of the US dollar, thus depressing exports and accelerating the off-shoring of American industry.

[IDEngineer]

Yes, everything is connected. Nothing is with zero opportunity costs. The goal is like Engineering: Finding the optimal compromise. Good politicians do a reasonable job. Bad ones... give us our present situation.

[Kasper]

How many people are prepaying?  Apparently Adafruit does.

3:00 - "we just want the stuff we ordered and paid for over a year ago"

[Robotec]

a colleague told me today the theory that Ti is selling directly to chinese distributors because of higher margin and thats why stopped giving dates and etc

Could be ,because even with higher prices our suppliers there keep "finding" stock.

[tom66]

There are pretty much no suitable buck converters left on Digi-Key for the condition of 3V-7.5V input (ie. up to 4xAA Lithium),  1A output.  I found one LT device at £9.80 a chip.  114 pieces left, so would do a third of one batch...

The shocking thing is there are 35,000 items listed... and only 5,000 of them have any stock at all.