US' calculations loss-leading for chip industry

The "signature economic initiative" that the Joe Biden administration is highlighting continues to take on a darker hue. According to The Wall Street Journal, the administration is set to award billions of dollars in subsidies in the coming weeks to leading semiconductor companies to help them to build new factories.

The report says the grants are part of the $53 billion Chips Act, intended to reshore production of advanced microchips and fend off the Chinese mainland, which is fast developing its own chip industry. The report cites industry experts as saying the funding is aimed at kick-starting the manufacturing of advanced semiconductors for artificial intelligence and weapons systems applications, which should come as no surprise given the Biden administration's war lust.

While the Biden administration is trying to paint a picture of a rosy new dawn for the industry, the move will only distort the chips market.