Semiconductor History (& Corrections)
In the discussion on Chip History, Mike said “Fairchild Semiconductor” when he meant “Shockley Semiconductor”. The story of Fairchild, and ultimately Intel follows in next week’s episode.
The Cashflow Memo
SHOWNOTES
This week on Telltales, we explore the real drivers behind oil prices, analyze new trends in semiconductor manufacturing and AI infrastructure, and unveil the first in a series on the history of chips, software, and biotech. Plus, Regeneron makes a surprising buy.
[01:00] Oil Supply and Demand (Exhibit C)
Hunt discusses Exhibit C, detailing global oil supply and demand trends. He notes that while demand is stable, excess capacity and increased output from OPEC+ could push prices lower. U.S. production is likely to flatten or decline slightly, contributing to a delicate supply-demand balance.
[05:26] US Gas Market Overview (Exhibit B)
Natural gas prices have stabilized around $3.80/MMBtu after a sharp fall from the Ukraine-driven 2022 spike. Hunt explains that supply increases, particularly from the Permian Basin, have kept pace with demand. Future price strength depends on whether supply growth continues.
[07:20] Federal Budget and Deficit Outlook (Exhibit A)
The team reviews U.S. government revenues and expenditures through 2026, highlighting modest deficit improvements but noting the need for further spending restraint. Hunt advises caution for investors and encourages keeping capital on hand in case of market dislocations.
[11:08] Semiconductor History Segment
In a new feature, the team begins tracing the history of semiconductors, starting with Bell Labs and William Shockley’s development of the first transistor in 1947. They discuss how early equity structures shaped Silicon Valley and set the tone for innovation-driven compensation models.
[15:28] Big Tech and AI Model Shifts (Page 1)
Jason explains a major shift in AI architecture toward reasoning-based models. He also covers announcements from Google I/O, including Gemini agent capabilities and enhanced video generation. OpenAI’s acquisition of Jony Ive’s startup ‘IO’ is seen as a countermove to Google’s strong showing.
[19:37] Semicap and U.S. Fab Investments (Page 3)
Discussion shifts to TSMC and Intel’s U.S. manufacturing expansions. Arizona fabs are scaling, but remain a fraction of Taiwan’s output. Intel’s foundry strategy faces skepticism but may appeal to customers like Nvidia seeking more capacity.
[21:31] Tesla, OpenAI, and Strategic AI Infrastructure (Page 1)
Tesla plans a $25B GPU investment to build out the Colossus data center. Meanwhile, OpenAI’s acquisition of ‘IO’ is framed as a strategic response to Google’s momentum. The episode questions whether OpenAI can maintain its innovation lead.
[23:43] Oakcliff Sailing Update
An interlude featuring Oakcliff Sailing’s latest activities and upcoming races, including the Block Island and Annapolis-Newport races. A call for marketing help is included along with discounted SailGP tickets.
[25:52] FDA Podcast and Healthcare Regulation (Page 19)
Jason highlights an FDA podcast where the commissioner explores ideas for faster clinical trials. This could reduce burdens on pharmaceutical sponsors and accelerate innovation.
[26:30] Regeneron Buys 23andMe (Page 19)
Regeneron acquires 23andMe for ~$250M, gaining access to a large genetic database. Jason discusses the potential to mine this data for novel drug discoveries and why 23andMe failed to capitalize on it.
[27:30] Lantheus, Vertex, and Imaging Trends (Page 15)
Positive trends for Lantheus emerge as imaging markets grow, especially for prostate cancer and Alzheimer’s diagnostics. Vertex faces competition from a reformulated generic pain drug. These developments shape expectations for both firms.
[30:27] Top Mark Sailing Rankings
Mike unveils the Top Mark Rankings—a leaderboard supporting Olympic-class sailors en route to LA 2028. The initiative offers visibility and structure to U.S.-based competitors and is backed by Top Mark Capital.
AAPL 0.00%↑ AMZN 0.00%↑ GOOG 0.00%↑ MSFT 0.00%↑ TSLA 0.00%↑ NVDA 0.00%↑ AMD 0.00%↑ INTC 0.00%↑ $TSMC ASML 0.00%↑ UNH 0.00%↑ CVS 0.00%↑ REGN 0.00%↑ LLY 0.00%↑ PFE 0.00%↑ MRNA 0.00%↑ LNTH 0.00%↑ BNTX 0.00%↑
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