Copyright © HT Digital Streams Limit all rights reserved. A government interest in Intel will expand US President Donald Trump’s lead in corporate America. Summary discussion of a potential agreement brings to mind the government’s attempt to save AIG during the financial crisis of 2008-2009. Intel, one of the world’s most important chipmakers and an important part of the American technical landscape, has struggled to fit the rate of growth of opponents in Asia such as Taiwan Semiconductor and Samsung. It is darkened in the race to develop artificial intelligence chips through domestic players Nvidia and advanced microva sets. This has left the US on foreign technical supply chains, a shift that the president and former President Joe Biden regarded as a threat to national security. However, while the Biden Administration has looked at the concerns by the Skips and Science Act, which has earmarked $ 53 billion to support for the semiconductor sector, the Trump administration seems to be taking a more direct route. According to the Wall Street Journal, how the government can take an interest in Intel, is now being taken out. Intel declined to comment on Barron. White House spokesman Kush Desai said reports on transactions not announced by the administration should be considered speculation. “It’s hard to think about how it can work, and it’s unprecedented in terms of the marriage of politics and private businesses,” said Paul Argenti, Professor of Management and Corporate Communication at Tuck School of Business at Dartmouth College, during an interview with CNBC on Friday. “Semiconductors are a very strategic asset, there is no doubt about it,” he added. “But the government as shareholder brings in real management risks.” In fact, the president is taking a new sneakers over US industrial policy. He made transactions to China-based sales of Nvidia and AMD and took a so-called gold share in the $ 14 billion taking of US Steel by Japan’s Nippon. The Department of Defense takes a $ 400 million stake in the MP materials of the Rare-Earth Metals producer. An Intel interest, if such an agreement happens, would be different. The nearest parallel is to the broader attempt by the government to sponsor Wall Street during the financial crisis 2008-2009, which the US entailed to take a major stake in the insurer American International Group. The Government considers AIG ‘too big to fail’, and provided loans and equity in the $ 182 billion area, and the group went out with a profit of $ 23 billion in 2012. Intel is like AIG because it is critical to an important element of the US economy, the technical sector, as the largest US company that both designs and manufactures its own discs. Although it lost about $ 2.9 billion over the past quarter, it still has a credit rating of investment grade and has a market value of more than $ 100 billion. However, the plans to build a $ 30 billion factory center in North -Ohio are full of delays. The hub is unlikely to be running until early next decade. Although Intel is not close to failure, its role means in the technical sector and the potential of being a player in AI, it is important to succeed. “Winning the AI race is not negotiable,” Foreign Minister Marco Rubio said late last month. “America must continue to be the dominant power in artificial intelligence to promote wealth and protect our economic and national security.” Earlier this year, Trump administration officials looked at a possible agreement that would enable Taiwan Semi to operate Intel’s watering cans as part of a joint ownership structure. However, the Wall Street Journal reported that the president was not sold on the idea of foreign control of a business that is considered critical to national security. A government stake in Intel will give the company the reassurance of the Iron Clad credit rating of the country as a back stop, which will probably remove any concerns about access to capital for its Ohio project. But it can also leave Intel vulnerable to the White House prescriptions, as he tries to define his strategy under the new CEO, Lip Bu-Tan. “Intel is at the same time dealing with tough competition, a lack of an AI pipeline and a Kapex intensive manufacturing company that still produces heavy losses and still remains the good operating leader TSMC who quickly builds a US presence,” said Bank of America analyst Vivek Arya in a recent client. That level of complexity makes the government’s decision to get even more challenging, especially in a sector undergoing rapid change. The government’s interests in key industries are also not always profitable. The AIG investment eventually paid off, but taxpayers lost about $ 10 billion from the rescue of Ford Motor, General Motors and Ally Financial at the same time. They have also not yet seen a cent of profit from the US’s five decades of support for the passenger track Road Amtrak. Dartmouth College Argenti is at great risk of choosing winners in real time. “If Intel delivers, it will look like a genius, visionary move. If not, it becomes a very expensive lesson in the government’s overreaction, which in my opinion is possible what we are looking at here. ” Catch all the corporate news and updates on live currency. Download the Mint News app to get daily market updates and live business news. More Topics #intel #Semiconductor #Artificial Intelligence Read next story
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