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Apple Wants To Buy Memory From China As Soaring Chip Prices Spark Inflation Shock

Zero Rss
3 months 1 week ago
Apple Wants To Buy Memory From China As Soaring Chip Prices Spark Inflation Shock

Last Thursday, in the aftermath of Apple's biggest one day plunge since Liberation Day, and second biggest single-day drop ever...

.... when the company lost over a quarter trillion dollars in market cap after the company's unprecedented price increase announcement  which for some products was as much as 50% as Apple decided to pass on soaring component costs to consumers, following similar moves from other consumer electronics companies....

...  and which Apple blamed on "unsustainable" prices by the memory cartel - namely SK Hynix, Samsung, Micron and Sandisk - who have been flooded with unprecedented demand from hyperscalers (freshly funded with hundreds of billions in newly-issued investment grade debt) we predicted that "China's memory makers are waiting by the phone" for a disgruntled Tim Cook to call, demanding bulk, cheaper RAM.

*APPLE SHARES CLOSE DOWN 6.1% IN BIGGEST DROP SINCE APRIL 2025

China's memory makers are waiting by the phone

— zerohedge (@zerohedge) June 25, 2026

To be sure, Apple wasn't alone: just hours later Microsoft also announced it was raising Xbox prices, in effect launching an avalanche of memory-driven price increases across the industry, now that it has been normalized to pass on soaring memory prices to consumers.

This, in turn, takes place following a series of reports - initially on this website almost a month ago which showed that the recent surge in core inflation is largely due to runaway chip/memory prices as Apple has since confirmed...

At what point does Trump start raging at soaring memory prices

PPI Electronic Components is pulling entire core index higher pic.twitter.com/v9ufHmx0gG

— zerohedge (@zerohedge) June 11, 2026

... followed last week by the WSJ also joining the chorus by reporting that "the Data-Center Boom is sparking a third wave of inflation."

Fast forward to this morning when with AI stocks tumbling as "check/capex payers", including AAPL, get crushed, while "check/capex receivers" soar...

Hyperscalers vs Chips pic.twitter.com/qtYEDM8lQ7

— zerohedge (@zerohedge) June 25, 2026

... the abovementioned Chinese memory makers did not have long to wait, and overnight the FT reported that Apple is lobbying the Trump administration for clearance to buy memory chips from CXMT, a Chinese company that the Pentagon as put on a blacklist because of alleged connections to the People’s Liberation Army. 

As we expected, the iPhone maker has been waging a lobbying campaign to get the White House’s blessing in order to ease the financial pressure of the rise in memory chip prices. A person told the FT that Apple approached the commerce department more than a month ago, but the tech company has been targeting other officials across the administration and allies in Washington.

Apple is not barred from buying chips from China's DDR giant CXMT, or YMTC, another Chinese memory chipmaker which focuses on NAND memory and has been growing its market share aggressively, having caught up to Sandisk, and set to become the world's 3rd largest maker of flash memory as soon as this quarter 

But the Pentagon has put both companies on its Chinese Military Company blacklist. The so-called 1260H list contains dozens of Chinese groups with alleged ties to the PLA that undermine US national security.

Securing CXMT as a memory supplier would help remedy a situation in which the tech giant is being squeezed by its own suppliers, a position in which Apple has never been before .

The lobbying campaign comes after President Donald Trump met his Chinese counterpart Xi Jinping in Beijing last month. Ahead of the summit, and in the months ahead of their previous meeting in South Korea in October, the US has held back from introducing new technology-related export controls that would affect Chinese companies.

As the FT notes, the Pentagon’s 1260H list creates reputational risk for companies, but in most cases it has no legal ramifications. We said as much just hours earlier when we said that those "worried about Chinese memory roadblocks by the US govt to ease memory inflation forget Trump undid 40 years of Iranian sanctions to lower the price of oil." And now that oil price inflation is contained, Trump has memory-driven cost-push inflation to fix ahead of the midterms, and whether he wants to or not, the only option his Admin has - besides imposing a price ceiling on memory (which may still come) - is to agree with Apple's request.

Last year, when memory prices were far lower and domestic producers did not have their customers by the throat with record chip prices and chip inflation was not yet the biggest driver of core prices, the commerce department added CXMT to a package of Chinese groups it intended to place on a trade blacklist called the “Entity List”. But the White House told it to hold off on new export controls because the administration was in the middle of tough negotiations with China to try to reach a truce in the trade war.

In any case, the FT notes that it remains unclear if Apple would get any guarantee from the administration, especially a promise that the US would not later put CXMT on the Entity List. Trump last year agreed to let Nvidia sell advanced H200 chips to China, a move many of his officials opposed.

In February, the Pentagon updated the 1260H list before withdrawing it within an hour. Several people said it was removed because the White House was angry that someone at the Pentagon had taken CXMT and YMTC off the list. When the Pentagon re-released it this month, both of the Chinese memory chip manufacturers had been reinstated.

“Apple choosing to partner with a Chinese military company would be a grave mistake,” John Moolenaar, the Republican chair of the House China committee, told the FT. However, he expect that the Republican will rapidly change his tune once there is public outcry in a the next few weeks against soaring electronic component prices, which will ultimately be blamed on runaway memory costs. 

“Helping the [Chinese Communist Party] succeed in its plans to dominate critical supply chains will make our country’s tech industry and economy more dependent on China at a time when we must build secure tech supply chains with our allies,” Moolenaar said, seemingly unaware that by not using Chinese components, he is allowing South Korea's memory cartel dictate not only US inflation but also the country's monetary policy, now that even Fed officials are pointing to AI/memory prices as key inflation drivers.

  • *KASHKARI: INFLATION DRIVEN BY SUPPLY ISSUES, INCLUDING AI-BUILD

Readers may recall that back in 2022 - when the world's faced another major surge in chip and component prices due to the logistical nightmare following covid - Apple faced a backlash when it considered buying memory chips from YMTC for iPhones to be sold in China. Marco Rubio, who was then the top Republican on the Senate intelligence committee, told the FT that “Apple was playing with fire”. Back then Rubio added that Apple would be “subject to scrutiny like it has never seen from the federal government” if it proceeded to procure YMTC chips. However, back in 2022, memory hadn't emerged as the biggest source of rising core inflation. It has now, and should Rubio refuse to pivot on his position, he would promptly become the target of public ire over surging consumer goods prices. 

Yet even with Tim Cook, and soon all other US consumer electronics products makers pushing hard for alternative memory sources, the memory lobby won't give up easily on the (temporary) oligopolistic position the commodity makers have achieved. “It makes no sense for the administration to decouple America’s reliance on critical minerals from China, only to approve new dependencies in a field as critical as AI,” said Michael Sobolik, a security expert at the Hudson Institute. 

One former official warned the US risked losing another industry by letting Apple buy memory from a group that receives Chinese subsidies. “Trump can show the courage to keep American memory alive for our security and our competitiveness or pour it down the drain so [Apple chief executive] Tim Cook can squeeze out a few more points of margin.”

It wouldn't surprise us if the "unnamed former official" is on South Korea's payroll because while China is still a modest actor in the memory space, the actual giants are all located in South Korea: Apple relies on US chipmaker Micron in addition to South Korea’s Samsung and SK Hynix for the DRAM memory used in its devices.

Meanwhile, in advance of a historic flood of orders that could send its market cap soaring, we reported that China's DRAM giant CXMT has received regulatory approval to list in Shanghai for the largest mainland IPO since 2022 as the Chinese national champion positions itself to challenge the DRam incumbents. The IPO of its domestic NAND peer, YMCT, is set to follow just weeks later 

Oh, and for those confused what happens when a commodity price surges, the post-covid case study should serve well: in 2023, DRAM prices because of a supply glut. This was a boon for buyers such as Apple, which was able to secure massive amounts of cheap inventory. 

But the AI boom of the past three years has seen a reversal in fortunes for the memory suppliers. As hyperscalers spent hundreds of billions of dollars for AI infrastructure, demand for advanced DRam — known as HBM — has led to a protracted shortage of traditional memory for consumer electronics. 

However, now that the market has shown it will no longer reward ridiculous amounts of hyperscaler capex spending - a U-turn from the market's reaction function for much of the past year - especially now that most of the big chip spenders no longer generatepositive cash flow and forced to issue billions in new debt for every incremental order of memory...

... in the end it won't be Trump that decides the fate of memory prices: it will be hyperscalers' own shareholders who will eagerly punish their management teams for incremental capex spending, forcing these companies to come up with new and creative ways to use and optimize existing Ram (likely in the form of many more Software-driven TurboQuant moments) to come up with more efficient and faster models.

In any case, after soaring into the stratosphere for the past year courtesy of all Hyperscaler free cash flow and hundreds of billions in on and off balance sheet debt, the party is finally ending and the memory bubble is about to burst. 

Tyler Durden Sat, 06/27/2026 - 15:10
Tyler Durden

Ukraine Closes Week Of Record Drone Attacks On Russia By Hitting Important Weapons Plant

Zero Rss
3 months 1 week ago
Ukraine Closes Week Of Record Drone Attacks On Russia By Hitting Important Weapons Plant

Ukraine announced Saturday that it used its Flamingo cruise missiles overnight to strike Russia's Titan-Barrikady weapons plant, which reportedly manufactures parts for its powerful Oreshnik missile.

The military plant is in Volgograd, formerly Stalingrad, which is a major industrial city in southwest Russia. Writing on X, President Zelensky described it as a "major industrial complex" where Russia "produces artillery systems and specialized military equipment, including components for missile launch systems."

Getty Images

"Every Russian defense facility involved in the war against Ukraine is a legitimate target for our long-range strikes," he wrote.

The Associated Press reports, "Volgograd Gov. Andrei Bocharov confirmed an attack on a business in the region’s Krasnooktyabrsky district, saying 10 people had been wounded and taken to a hospital. He said production facilities at the site were damaged but did not identify the company."

Additionally, "Ukraine's state security service said Saturday morning that Ukrainian forces also struck an oil pumping facility in Russia’s Vladimir region that supplies fuel to Moscow, for the second time this month."

But on the other side of the border, Ukrainian media reports that Russia was also busy with now nightly airstrikes:

Russian forces targeted production facilities belonging to the Naftogaz Group, Ukraine's largest national oil and gas company, in the Poltava and Kharkiv regions.

The barrage of attacks included 129 drones, of which 113 were destroyed or jammed by Ukrainian forces, Ukrainian media reported.

The Russian overnight attacks on Ukraine killed two people and injuring more than 20, according to state officials.

At a moment much of the globe's attention remains fixated on Iran and the fate of energy shipping through the largely blocked Strait of Hormuz, the Ukraine war is rapidly escalating.

Footage shows Ukrainian FP-5 Flamingo cruise missile launches and precision strikes on the Titan-Barrikady Plant in Volgograd, Russia.

Titan-Barrikady, officially known as JSC Federal Scientific and Production Center "Titan-Barrikady," is responsible for producing heavy… pic.twitter.com/xTYF2k2dLy

— OSINTWarfare (@OSINTWarfare) June 27, 2026

Ukrainian leadership has issued some astounding stats on the escalation on its side of the border:

Russia attacked Ukraine with 1,400 drones and 1,500 guided bombs

President Volodymyr Zelensky stated on Saturday, June 27, that Russian forces deployed approximately 1,400 attack drones, 1,500 guided aerial bombs, and 19 missiles of various types, including ballistic missiles, against Ukraine over the past week.

In a statement published on Telegram, Zelensky noted that 15 Ukrainian regions were subjected to Russian attacks during the seven-day period. He highlighted that the cities of Kherson, Zaporizhzhia, Kharkiv, and Sumy faced near-daily bombardment.

But it also over the past week has sent projectiles into Russia in the thousands. Ukraine's asymmetric warfare strategy against Russia's much-larger and better armed military machine has put Kiev in significantly better position - in terms of potential negotiating leverage - than the status of a year or so ago.

Russian forces still have the upper-hand on the front line in the east, but the pain clearly being inflicted on Russia's economy can't be ignored at this point. There are reports of fuel shortages across dozens of regions and especially in Crimea over the past several days.

Multiple Ukrainian FP-5 “Flamingo” Cruise Missiles slam into the Moscow Institute of Thermal Technology’s “Titan-Barrikady” Defense Plant, which designs and produces parts for artillery and ballistic missile launchers, in the Southern Russian city of Volgograd. pic.twitter.com/pwTrnuHVL4

— OSINTdefender (@sentdefender) June 27, 2026

President Trump has lately suggested that Ukraine is doing well in the war, or at least much better than it once was. Kiev now feels the pressure to keep this narrative going, also so it can attract more and more weapons and intelligence help. But at some point Russia will feel it necessary to strongly reassert its red lines. This could come in the form of another massive escalation, and against 'decision-making centers'.

Tyler Durden Sat, 06/27/2026 - 14:35
Tyler Durden

Cheer the huge Supreme Court slapdown of racketeering lawyers

NY Post
3 months 1 week ago
In the case at hand, the junk-science claim was that Roundup, the widely used weedkiller, caused a Missouri man’s cancer — so the company that makes it owed him (and his lawyers!) $1.25 million because it never put a warning to that effect on the label.
Post Editorial Board

Supreme Court's Alito Offers Unusual Response To Sotomayor's Dissent In Immigration Case

Zero Rss
3 months 1 week ago
Supreme Court's Alito Offers Unusual Response To Sotomayor's Dissent In Immigration Case

Authored by Matthew Vadum via The Epoch Times,

At a recent Supreme Court sitting, Justice Samuel Alito took the unusual step of responding from the bench to Justice Sonia Sotomayor's spoken dissent from an immigration-related opinion he wrote.

This combination photo shows Justice Sonia Sotomayor, Sept 16, 2024, in New York, left, and Justice Samuel Alito in Rome, Sept. 20, 2025. AP Photo

The June 25 incident took place in the final days of the current court's session, as the justices try to issue opinions in remaining cases before the court's summer recess, which typically begins before the Fourth of July.

Alito read aloud a summary of the majority opinion in Mullin v. Al Otro Lado. The 6-3 decision ruled that the government can turn away asylum-seekers at the border, clarifying a law that requires individuals to be inspected when they arrive in the United States.

Sotomayor followed, reading a summary of her dissenting opinion aloud.

Sotomayor said many asylum seekers face a challenging journey and recounted that after the United States and other countries turned back a ship full of Jewish refugees fleeing persecution in Nazi Germany in 1939, about 250 of those passengers died later in the Holocaust.

Sotomayor said the majority's opinion here would allow the Trump administration to prevent people from applying for asylum at the border, and that this would lead to more deaths. The decision "regrettably and tragically extinguishes the light of the torch of the Statue of Liberty," she said.

In her written dissent, Sotomayor stated, "more people will be forced to walk along the U.S.-Mexico border in dangerous conditions, trying to find a port that will inspect them."

Sotomayor's spoken dissent seemed to come as a surprise for Alito, who responded extemporaneously to it. He appeared frustrated, saying he would have said more during the court sitting and provided more details if he had known she planned to speak.

For the court's majority, Alito said, the case was about whether border officials can delay asylum seekers' entry into the United States "until they can be processed in a safe and orderly way."

The justice said that the policy at the center of the case had been used under both the Obama and Trump administrations. "I won't add anything more to that," he said.

A group of 13 asylum-seekers, led by immigrants' rights group Al Otro Lado, or To the Other Side, had filed suit in 2017 against the government's "metering" policy. That policy let border agents - usually at U.S. ports of entry - turn away asylum-seekers to avoid overcrowding of border facilities.

A federal law says that "any alien who is physically present in the United States or who arrives in the United States ... may apply for asylum," regardless of legal status.

In the majority opinion, Alito wrote: "This case presents a straightforward question: whether an alien who seeks to enter the United States from Mexico 'arrives in the United States' when he or she is still in Mexico.

"In the decision below, the United States Court of Appeals for the Ninth Circuit answered 'yes.' That is wrong."

Tensions in Public View

This was not the first time tensions between Supreme Court justices have been on public display.

In March, Justice Brett Kavanaugh and Justice Ketanji Brown Jackson publicly clashed over the court's various emergency orders that have allowed President Donald Trump to pursue his policy agenda.

Lower courts have stifled Trump's policies by issuing orders blocking some of them. The Supreme Court has often provided emergency relief by lifting those orders.

Jackson said the Supreme Court is "creating a kind of warped" legal process by intervening at an early stage of a case and basically predicting the outcome before the arguments are developed fully.

"The administration is making new policy ... and then insisting the new policy take effect immediately, before the challenge is decided," Jackson said. "This uptick in the court's willingness to get involved in cases on the emergency docket is a real unfortunate problem."

Kavanaugh said the Supreme Court is only doing its job by addressing the emergency applications filed.

The Department of Justice's rush to the Supreme Court didn't begin during the Trump administration, the justice said. He said that as it becomes more difficult to enact legislation through Congress, administrations "push the envelope in regulations."

"Some are lawful, some are not," he said.

Sotomayor also made a rare public apology in April to Kavanaugh for making what she called "hurtful comments."

She had previously said during a speech at a law school that a colleague "probably doesn't really know any person who works by the hour."

Culture of Collegiality

Supreme Court justices have publicly stated that members of the nation's highest court are friendly and civil in their dealings with each other and have eschewed partisanship.

Chief Justice John Roberts said in May 2023 that "there has never been a voice raised in anger in our conference room," referring to the chamber in which justices discuss and vote on pending cases.

"Our court consists of nine appointees by four presidents. We deal with some of the most controversial issues in the country, yet we maintain collegial relations with each other," he said.

Sotomayor and Justice Amy Coney Barrett attempted to distance themselves from political parties and particular presidents in February of this year, with Sotomayor calling parties "the worst thing" to happen to the judiciary.

"They began to adopt our buzzwords as buzzwords - some of the discussions we were having like on originalism and plain text and things like that," Sotomayor said. "But instead of discussing those terms with respect to approaches that made sense and why - with all the nuances that those approaches contain - they just began to label people according to the buzzwords."

Barrett said, "We're not Obama judges and Trump judges, but we're also not Democratic judges or Republican judges."

"We don't sit on opposite sides of the aisle," she said. "We all wear the same color of black robe ... our loyalty lies all to the Constitution and to the court."

Barrett said even though the court is often described as "deeply divided," the vast majority of cases lead to unanimous or close-to-unanimous decisions.

Barrett likened the court to a "family" in which the justices offer small acts of kindness to promote a culture of collegiality.

She said it is a Supreme Court tradition for the second most junior justice to throw a party for the new justice who is entering. Kavanaugh, she said, threw a party for her, while she threw one for Jackson.

Sam Dorman, Stacy Robinson, and The Associated Press contributed to this report.

Tyler Durden Sat, 06/27/2026 - 14:00
Tyler Durden

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