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In theory, shouldn't he say exactly the opposite thing if this was the goal? If demand is projected continue for a long time, this may encourage more competito

In theory, shouldn't he say exactly the opposite thing if this was the goal? If demand is projected continue for a long time, this may encourage more competitors to enter this space, so supply will increase. On the other hand if everyone thought that the demand will end soon, nobody would invest in more capacity and shortage would last longer. I think this is just for short term shareholder profit.

greycol 16d ago
No because, some companies know they'll need ram, but they may have some leeway on timing (i.e. doing more to prolong the life of systems they'd typically replace). That means to guarantee ram they need to enter an agreement to buy the ram now. By setting the expectation that these prices continue or get worse companies that may have put off agreeing to these terms locking in prices based on demand rather than something closer to the cost of production. The agreements that these companies are being forced to make are upfront payment and then a top up to meet current market prices before delivery, there is no downside for these ram companies whether the price rises or falls (at worst they end up with supply that was already payed for by a bust company at a healthy margin and a glut in the market that would arrive anyway) Competitors are going to come online anyway because of the threat of chip embargoes against China that mean they are investing in production regardless of what the outside world is doing.
bigbadfeline 16d ago
> If demand is projected continue for a long time, this may encourage more competitors to enter this space, so supply will increase. There are no competitors that can muster the capital to make decent RAM... other than China but China is under a heavy sanctions and tariffs regime, when Apple mentioned using Chinese RAM to ease pricing they were quickly shushed by above. The current monopolists aren't building new capacity either or are simply pretending to do it. It's a planned monopoly market for reasons I can only speculate about.
- apple4ever 15d ago
  But the longer it goes on, the more desirable it looks to new entrants.

greycol 16d ago

No because, some companies know they'll need ram, but they may have some leeway on timing (i.e. doing more to prolong the life of systems they'd typically replace). That means to guarantee ram they need to enter an agreement to buy the ram now. By setting the expectation that these prices continue or get worse companies that may have put off agreeing to these terms locking in prices based on demand rather than something closer to the cost of production. The agreements that these companies are being forced to make are upfront payment and then a top up to meet current market prices before delivery, there is no downside for these ram companies whether the price rises or falls (at worst they end up with supply that was already payed for by a bust company at a healthy margin and a glut in the market that would arrive anyway) Competitors are going to come online anyway because of the threat of chip embargoes against China that mean they are investing in production regardless of what the outside world is doing.

bigbadfeline 16d ago

> If demand is projected continue for a long time, this may encourage more competitors to enter this space, so supply will increase. There are no competitors that can muster the capital to make decent RAM... other than China but China is under a heavy sanctions and tariffs regime, when Apple mentioned using Chinese RAM to ease pricing they were quickly shushed by above. The current monopolists aren't building new capacity either or are simply pretending to do it. It's a planned monopoly market for reasons I can only speculate about.

apple4ever 15d ago
But the longer it goes on, the more desirable it looks to new entrants.