Griffin warns losing TSMC chips could trigger a Great Depression
Citadel CEO Ken Griffin warned at the Goldman Sachs Apex Symposium that losing access to TSMC chips could cause US GDP to drop 8% in six months, leading to a modern Great Depression. He highlighted that a disruption would halt production of planes, cars, and electronics, while also damaging China's economy. Griffin noted China leads in 67 to 68 critical technologies and urged educational investment over tariffs to compete.
*this image is generated using AI for illustrative purposes only.
Citadel founder and CEO Ken Griffin warned that losing access to Taiwan Semiconductor Manufacturing Co. Ltd. chips would cause the US gross domestic product (GDP) to decline by 8% within six months, triggering a modern Great Depression. Speaking at the Goldman Sachs Apex Symposium, Griffin emphasized that TSM microchips are embedded in every high-end product manufactured today. He argued that a military escalation or blockade around Taiwan would create a dangerous bad equilibrium with absolutely no winners, paralyzing core American industrial and technology sectors almost overnight.
Griffin illustrated the systemic vulnerability by stating that Boeing would stop making planes in six months, most new cars would cease production, and consumer electronics manufacturing would halt. He noted that the fallout would severely damage the Asian superpower as well, with the American economy's tailspin triggering severe draconian knock down effects for China’s domestic economy. The billionaire investor pointed out that the United States remains a massive primary export destination for global goods.
Beyond the immediate semiconductor crisis, Griffin urged Western leaders to address the broader reality of Chinese technological advancement. He stated that China currently leads the world in approximately 67 to 68 out of 75 critical technologies, including solar energy, electric vehicle batteries, and quantum computing. This dominance is fueled by an intense institutional focus on STEM degrees.
To counter this economic reality, Griffin asserted that protectionist trade policies are insufficient. He insisted that the most important step is not tariffs, but rather educating youth to out compete, out innovate, and out problem solve their contemporaries. The interview concluded with reflections on market risk management, where Griffin emphasized that while asset allocators cannot hedge against every tail event, they must monitor exposures to ensure worst-case losses remain tolerable.
TSM Performance Metrics
TSM shares showed significant movement in the recent period. The stock closed unchanged at $436.96 per share on Thursday and was down 0.12% in overnight trading.
| Metric | Value |
|---|---|
| Year-to-date return | Up 45.86% |
| One-month return | Up 2.38% |
| One-year return | Up 91.77% |
Benzinga’s Edge Stock Rankings indicate that TSM maintains a strong price trend in the short, medium, and long terms, with a good growth score.
How might the US government accelerate domestic semiconductor production to mitigate the risks highlighted by Griffin?
What specific policy changes could Western leaders implement to counter China's dominance in critical technologies?
How could a potential Taiwan conflict impact global supply chains beyond the semiconductor industry?
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