Sec. Raimondo on Taiwan Semi CHIPS Act Funding, Sec. Yellen Exclusive in China, Dimon on Rates and AI 4/8/24

Jim Cramer (0:00)

It's Jim Cramer here. You're listening to the opening bell of CNBC's Squawk on the Street. Don't miss a minute of the action.

Carl Quintanilla (0:08)

Good Monday morning, welcome to Squawk on the Street. I'm Carl Quintanilla with Jim Cramer, David Faber at Post 9 of the New York Stock Exchange. Futures are steady despite some rising treasury yields at year to date highs.

A busy week in focus with CPI, Q1 earnings season begins, Yellen in China, and of course, a total eclipse of the sun. Our roadmap begins with America's chips play at Taiwan Semi, getting a multi-billion dollar investment from Uncle Sam to build one of the world's most advanced chips plants in Arizona.

David Faber (0:34)

Plus, Georgia Secretary Yellen is not ruling out the possibility of new tariffs on China. Our Sara Eisen wraps up her exclusive interview.

Janet Yellen (0:45)

Well, trade and investment between our two countries is beneficial and desirable. It needs to be on a level playing field.

And in a number of ways we feel it's not.

David Faber (0:59)

And Jamie Dimon's warning for investors, higher rates, stickier inflation and the profound implications of AI.

Carl Quintanilla (1:07)

We begin with news surrounding a major supplier to Nvidia and Apple. Taiwan Semi's up in the pre-market. The White House announcing $6.6 billion in grants for the company's Arizona plants. This is all under the Chips Act. Under the agreement, TSM is committed to adding a third chip factory to the complex.

It started building in 2021

Commerce Secretary Raimondo will join us later on this hour. Jim, we're talking some 20,000 construction jobs. There's money in here for workforce training.

Jim Cramer (1:37)

This is the big one because it's too nano. It's the ones that we really need. It's the ones that we can't build. They're too expensive.

I don't know, we'll have to talk about how much money they really need. We don't have enough engineers typically to build these. This is exactly what Taiwan Semiconductor sells at in Taiwan.

And David, you know that this is the most tenuous, and we'll talk with Sara about it, the most tenuous situation we have, which is that we could lose access to the two nanometer if China moves on Taiwan.

David Faber (2:11)

We could.

Jim Cramer (2:11)

Right, and that's the big threat.

David Faber (2:14)

Yeah, it's certainly an important component of our concern if that were to occur. Supply chain, supply chain.

We've said so many times when it comes to high-end chips, TSMC is the de facto place you go, period. Intel would hope otherwise at some point long in the future. By the way, I did hear your comments about Intel with Carl on Friday, I believe that was, when I wasn't here with Madd-Dash. Yeah, but we can put that aside for a moment.

Jim Cramer (2:41)

We're gonna ask her about Intel because I think the comments that I made were really existential about Intel Friday.

David Faber (2:49)

Yeah, but as for TSMC and the 6.6 billion, to your point, it's going to require an enormous amount of investment from that company. Now, when they get to two nanometer in this plant in Arizona, if and when they do, it may not still be the, it may not be at the very forefront of the technology, things may have moved beyond that.

Jim Cramer (3:08)

Yes, it's true. By that point, it may be obviated, but the fact is, right now, this is pretty good.

This is what you could, I mean Nvidia could use this.

Right, right. You know Carl, one of the problems we have over and over again is, why did we go to Taiwan? Well, because we didn't have the engineers, it was too much, too expensive to build, and we did not have a sense that maybe the US would be left adrift. It was much more private capital, and a company like an AMD decided, you know what, we need to go foundry light. Let's get rid of global founders. Let's just go foundry light, let's go there. And it made a lot of sense, and believe me, if this country weren't located within the zone of what China thinks is theirs, we wouldn't be doing this. Like if this were in Mexico, which is another cheap labor force, we wouldn't have to do this.

David Faber (4:03)

I think it's important to point out that Taiwan gave plenty of subsidies as well to TSMC through the years.

Jim Cramer (4:10)

Yes, but I'm just saying that-

David Faber (4:11)

There was plenty of state support there for that company.

Jim Cramer (4:13)

Oh, always, but we wish that it weren't in Taiwan. We'd be better in Singapore.