Reuters: “The U.S. House Select Committee on China said in a report that "it has sent a formal letter to Nvidia demanding answers about sales to China and Southeast Asia to examine whether and how its chips ended up powering DeepSeek's AI models—despite U.S. export restrictions".
Nvidia warned on Tuesday of a $5.5 billion hit after Washington restricted exports of its H20 AI chip to China. The move to restrict H20 shipments is Trump's latest effort to limit China's access to advanced semiconductors.
The U.S. has banned exports of Nvidia's most advanced chips to China since 2022, concerned that advanced technologies could be used by China to build up its military capabilities.”
File under “told you so.”
Before filing under "told you so" you may want to get your facts straight.
In 2022 the Biden administration implement export controls that limited US companies, like Nvidia, from exporting their highest performance chips to China.
In response, Nvidia introduced a new set of chips that had sufficiently lower performance that they could be exported to China.
In October 2023, the Biden administration tightened export controls further that made some of the previously designed China-specific chips ineligible for export.
Predictably, Nvidia responded by designed a second generation of chips for China, for example the H20 that was released in early 2024 and was completely compliant with export controls. Until recently, it is the highest performance chip that could be legally exported to China.
The Trump administration has now banned the export of the H20. I'm not sure if they banned the H20 specifically or more broadly lowered the performance guidelines of what can be exported. It's important the note that there was bipartisan support for blocking H20 exports, and so while I've said "Trump administration", Elizabeth Warren was one of the leading advocates for the block.
So, no nefarious loophole closed. Just a further tightening of what can legally be exported.
Note, Nvidia is sitting on stockpile of more than 1 million H20 chips (hence the $5.5 billion write-off) that they can no longer export to China. American companies would rather pay more for Nvidia's highest performing chips.
So, let me get this straight. Nvidia can no longer sell chips to Chinese shell companies in Singapore. Redesigns a chip to avoid U.S. restrictions on sales to China, chips that can be reconfigured for use by Deep Seek. The Trump Administration bans their export. Got it. Keep the file filed.
Before filing under "told you so" you may want to get your facts straight.
In 2022 the Biden administration implement export controls that limited US companies, like Nvidia, from exporting their highest performance chips to China.
In response, Nvidia introduced a new set of chips that had sufficiently lower performance that they could be exported to China.
In October 2023, the Biden administration tightened export controls further that made some of the previously designed China-specific chips ineligible for export.
Predictably, Nvidia responded by designed a second generation of chips for China, for example the H20 that was released in early 2024 and was completely compliant with export controls. Until recently, it is the highest performance chip that could be legally exported to China.
The Trump administration has now banned the export of the H20. I'm not sure if they banned the H20 specifically or more broadly lowered the performance guidelines of what can be exported. It's important the note that there was bipartisan support for blocking H20 exports, and so while I've said "Trump administration", Elizabeth Warren was one of the leading advocates for the block.
So, no nefarious loophole closed. Just a further tightening of what can legally be exported.
Note, Nvidia is sitting on stockpile of more than 1 million H20 chips (hence the $5.5 billion write-off) that they can no longer export to China. American companies would rather pay more for Nvidia's highest performing chips.
So, let me get this straight. Nvidia can no longer sell chips to Chinese shell companies in Singapore. Redesigns a chip to avoid U.S. restrictions on sales to China, chips that can be reconfigured for use by Deep Seek. The Trump Administration bans their export. Got it. Keep the file filed.
You didn't get any of that straight. Try reading what I wrote.
Wild that trade with China has virtually ended. My understanding is that in a few weeks the ports will stop, trucks will have little to carry and by June shelves will be empty.
markets are not believing this will happen. An elaborate game of chicken. Will a 'deal' be made before many transport and retailers go out of business?
Stocks will have to fall a lot more if we don't trade with china anymore.
🚨🇨🇳🇺🇸NVIDIA’s CEO Jensen Huang is back in Beijing—and he’s not just sightseeing. On April 17, Huang met with the founder of Chinese AI startup DeepSeek to explore how NVIDIA can develop next-gen chips tailored for China’s market—while staying within the regulatory guardrails set… pic.twitter.com/k3Mb3BCPnz
Want to know why people own the Hussman fund? Solid hedge in times like this.
60/40 doing fine, down just 2% in a very rough time. High bond yields make that strategy work pretty well.
Bonds as a whole have performed well. Unlike the 2022 bear market when bonds fell with stocks. Good to have portfolio theory work again. A typical 35/65 retirement portfolio is making a few basis points this year, even after all this carnage. That the world is working should give investors some confidence to reinvest when the tariff nightmare ends.
Pretty much all the hedges are working well. staples, utilities, bonds, gold. Nice.
Europe going to the moon still. I do think portions of portfolios meant to be in equities are simply moving to Europe from the US. Probably not a reason to buy europe because that will end and it doesn't reflect a genuine renaissance in europe.
Interesting that Ai stocks have trounced tech as a whole. Suggests there's more juice in that stone to come.
In the end, the SP500 is only down 10% and bonds are good. As painful as this has been...overall not a nasty correction for generic portfolios. And if you believe in the long term viability of investing in tech...lots of stocks on sale right now. Hard to believe they will not have a good next 5 years.
Want to know why people own the Hussman fund? Solid hedge in times like this.
60/40 doing fine, down just 2% in a very rough time. High bond yields make that strategy work pretty well.
Bonds as a whole have performed well. Unlike the 2022 bear market when bonds fell with stocks. Good to have portfolio theory work again. A typical 35/65 retirement portfolio is making a few basis points this year, even after all this carnage. That the world is working should give investors some confidence to reinvest when the tariff nightmare ends.
Pretty much all the hedges are working well. staples, utilities, bonds, gold. Nice.
Europe going to the moon still. I do think portions of portfolios meant to be in equities are simply moving to Europe from the US. Probably not a reason to buy europe because that will end and it doesn't reflect a genuine renaissance in europe.
Interesting that Ai stocks have trounced tech as a whole. Suggests there's more juice in that stone to come.
In the end, the SP500 is only down 10% and bonds are good. As painful as this has been...overall not a nasty correction for generic portfolios. And if you believe in the long term viability of investing in tech...lots of stocks on sale right now. Hard to believe they will not have a good next 5 years.
Here's an update on the $SPX straddle for 12/31/2025.
As of 4/17, the $SPX is 5282.7 and the breakevens are 6072.50 and 4487.50. The implied volatility is 22.32%. 4/11 was 5363.36, BEs were 6214.05 and 4505.95, IV was 23.40%.
OK gente, WTF does this mean? Option buyers and sellers imply, as of 4/17, there's a 21% probability the S&P 500 will be above 6072.50 on 12/31. There's a 79% chance it will be below that and a 21% probability it's below 4505.95.
So, let me get this straight. Nvidia can no longer sell chips to Chinese shell companies in Singapore. Redesigns a chip to avoid U.S. restrictions on sales to China, chips that can be reconfigured for use by Deep Seek. The Trump Administration bans their export. Got it. Keep the file filed.
You didn't get any of that straight. Try reading what I wrote.
Jensen is a globalist and cares little about what is best for America. If I had to guess what future holds, there will be a glut of this type of chip, and others; AI will attain routine use, and no one will care what chips China gets.
This post was edited 34 seconds after it was posted.
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