Re: AMD
Max, great post. I was trying to say pretty much the same things you said, but clearly you are much more knowledgeable about the industry.
One quibble:
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2. The average selling price of these things has been falling for years. Margins on the actual manufacturing of these chips are still high >50%. That means there is still plenty of room for prices to fall further.
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I think the main reason these margins are so high is that the fixed/sunk cost of a new fab is so high. So the high margins are really just the necessary means of paying off the fixed costs.
So, I'm not disagreeing with your conclusion that this is not a great long term investment, but I'm not sure that the margins can fall that much (w/o AMD going bankrupt, for example).
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