romaine: let's get you caught up on where markets stand. chip stocks fall and the rest of the market. caroline: numerous ceo's including the heads of dell, alphabet and even gm went directly to the white house to speak with president biden.

the executives at out their concerns around the supply of semiconductors. president biden telling them he has bipartisan support to address the shortage. there is a direct listing we will have to discuss shaking up the crypto world. we are also talking about chips. nvidia stealing the attention, unveiling his first approach to a microprocessor. joe: you can never get enough chip talk and today is a big day for it because of course the white house summit you mentioned, but also nvidia, which of course is such an incredible juggernaut, bigger than intel, now going directly after intel's bread and butter, getting right into these courtships. the company offering their first server microprocessor, something something something. i don't know what all these things mean, but it looks like it is fast. so we are very excited about this company and potentially a threat to intel. romaine: it is a big deal for

nvidia and of course a big deal for financial journalists where we can talk about the horse race. joe: the horse race. for more, let's bring in announcing amash and. thank you so much for joining us. how would you put into language we can understand? >> i would safely note, as cheeky as i am, something something something horse race, i was taking notes there. but look, nvidia is the dominant force in ai. and one of the things it has been trying to do is move outside that zone into traditional workloads. workloads that are dominated from intel and amd. and beyond acquisition was to give it horsepower, if you may. to expand into more than just ai. it is obvious he dominant in ai

but one of the things they are best at his they have advanced their development and they are producing several processors adjacent to their gpu's for accelerated computing that can power the server. so it takes the fight directly to amd and intel beyond what we thought could have happened with the arm announcement. so this is very positive for nvidia in the long run. in the near term it is going to give customers at amd and intel some pause saying ok, this is the roadmap. who do we want to commit to over the long-term, and do i want to have a split strategy between company a and company b? obviously for intel, which is

the dominant share leader, that is a negative thing. caroline: meanwhile, we have some really awesome graphics being shown. making it look very sexy. why has nvidia managed to beat the timeframe that you had estimated? anand: that is a great question. look, nvidia does only one thing and does it really, really well. it makes gpu's. and if you look at gpu's, it hasn't gotten away from its core focus, but other markets have embraced gpu's as a legit processor entity for more than j ust graphics. so if you look at ai for example, if you look at autonomous driving for example, these run very nicely on gpl's -- on gpu's. in fact they run much better on gpu's than cpu's. so the market has come to them and they have built that expertise over several decades, and they have done it with pc graphics, and notebook graphics are expanding, and they have

done it really well with each generation of their architecture, the latest architecture, and ray tracing, etc., gives light a natural feeling. so all the things they have done has been incremental, but the market has come to them. romaine: real quickly here, i am curious about the way that some end customers here have started to turn inward with their chip development. apple being the most notable. i am wondering how much of a threat, if at all, is that trend? anand: i am going to go back to my ice cream shop analogy. the variety of flavors in the ice cream shop is expanding and will continue to expand. to the extent that somebody wants a really specialized version of cookie dough and mint chip all rolled into one, they will try to make it in-house. but they are not a lot of customers who can do that, and they will not do that for all the flavors. when you can go out and buy it at a good price and it is good

enough at a great price for your systems, you are going to do that. that is what amd, nvidia and intel offer. is only for those ultra special varieties where you have a secret sauce or a secret flavor you want to develop, predominantly for in-house, that is where you'll make your own chips. and that is where aws, etc. caroline: only anand can make a chip discussion end up about ice cream. anon sheena vossen, thank you. coming up, white house hosting a summit on semiconductor shortage, but the breakdown we need to get his major takeaways. will anything change? this is bloomberg. ♪ ♪

>> this is an issue that has broad support in the u.s. congress. we talked about whether or not we are doing anything bipartisanly. well, we are. both sides of the aisle strongly support what we are doing. where i think we could really get things done for the american people. romaine: that was president biden speaking earlier during the ceo summit on the semiconductor shortage. when you look at the semiconductor index from a stock perspective, chips have done ok. joe: what is everyone complaining about? everything is fine. i don't think we got the answer yet on how philadelphia got the name the semiconductor index, but they have done externally well. one year, up 100%. not bad.

joining us with more insight is a harvard business school professor of management practice, willy shih. we've talked to you a few times now about the question of whether there is something we can do policy wise to really revive u.s. semiconductor manufacturing. the question only gets more acute all the time. when you look at what is going on, the white house summit, bipartisan support perhaps for legislation, do you see policy momentum building towards something that can bring about meaningful change? willy: i think what we are witnessing is a development of an understanding of issues. now, i looked at the summit today and i said, ok, we have s ome very diverse issues there, and there are couple issues underneath. one is technological leadership, and the other is supply chain resilience and dependency on overseeing manufacturers in a time where it is affecting a lot of output in the auto industry.

so, i think it's a process. there seems to be a lot of support for the problem. there seems to be movement towards spending a lot of money on the problem, but it's kind of -- the answers are not clear yet. caroline: not just the u.s. is looking at spending a lot of money on the problem. here in europe they are talking with the digital compass as it is known, to be putting subsidies to work in your. even -- in europe. even less of a reason here because no one is making phones or electricals, but there are some chip equipment maker's here in europe. is it the right thing to be subsidizing right now, to be making it on your own soil? willy: global industry in semiconductors is very interdependent. we depend on european toll makers and sources of a lot of intellectual property depend on american designs, they depend on

asian manufacturing. parts come from all over the world, tools come from all over the world. it is highly interdependent. so i think to say that we want complete self-sufficiency is kind of a pipe dream for almost everybody. the theme that does emerge though is we have been through a period where the supply chains have really suffered, especially in the last six months in semiconductors. now there is the question, what is a good solution to that problem? but it's a little different than i want to be completely independent. romaine: we talk about the idea of a boost capacity here in the u.s., and then you always tend to forget that we already have i guess a relatively robust chip manufacturing sector here in the u.s. whether you are talking about your intels, or even go down and

look at serious logic and some other names. these companies exist. they certainly have the technology, they certainly have the brainpower. what is holding us back as a nation from ramping up to a level that would meet our demand needs? willy: you rightly point out that there are some sectors where i think we are really quite strong. there is a sector called analog mixed-signal electronic components, where u.s. share of global manufacturing is around 30%. t.i., analog devices, guys like that, theya re leaders -- they are leaders. where the leadership has changed hands in the last decade has been a high-end logic. the things that go into your iphone baseband processor -- although i will point out that chips from corvo's and companies like that go into your iphone as well. they handle the radio part.

what we need is a little more resolution on who the players are and where the problems are. we suffer from a competitive high-end. because intel has fallen behind. we've also suffered over the last -- and i would say this problem has been almost three decades in the making, where we don't like manufacturing in this country when it's extremely capital-intensive. a lot of investors are kind of allergic to capital intensity. so it is like, hey, the design part, ship that manufacturing overseas to someone who might be willing to do that. now all of a sudden we see a couple companies overseas who amassed a lot of capabilities, a lot of skills, and can actually make some good money on it. and it's like, oh, maybe we shouldn't have done that. joe: the whole the reason we are talking about the chip shortage, the acute chip shortage this

year, it stems from the automakers in the parts that they are missing are not high-tech. in fact, they might cost $1 each. but if you identified a real weakness emerging at the high-end. if you look at what is going on at the white house today, these car companies, their need is not the advanced stuff you are talking about. when thinking about strategy, where should we focus our efforts? it is on -- is it on the basic stuff, so we don't run into shortage were car companies cannot make a basic stuff, or the complicated and difficult stuff? willy: as a country, i think we need to invest in capabilities. a lot of that comes from research and of element on the front end. that is where the u.s. has historically led. the car companies are in trouble because they share a manufacturing base. so if you're one of the big detroit automakers and you buy

semi conductor parts from one of the automotive chip suppliers, one of the shocking discoveries, which probably should not have been that big a surprise, is that when you go down several layers in the supply chain, it's like, oops, i share some of the supply base. i'm competing with ipads, tv sets, for the chips that drive the flat-panel monitors and things like that. so the shared supply base has been kind of a surprise. now, we have given up a lot of that capacity, although we still have some in the u.s. chip manufacturers, they have labs in phoenix and austin, texas. so, there's still some of that manufacturing in the u.s., but a lot of that capacity has gone overseas. romaine: willy, always great to catch up with the. willy shih of the harvard business school, and now of

course three decades of working in the tech industry. coming up on this show, all eyes on crypto. a direct listing. we discuss what this listing means for the broader crypto space. jill carlson joins us next. this is bloomberg. ♪ ♪

caroline: today our focus is on the word direct, when it comes to technology. we were just this ghostly direct approach the ceo's took at the white house. also going to talk erect listing in the crypto world, as the main industry index hitting a new record. even bitcoin trying to get there. joe: exactly right. we see the bloomberg galaxy crypto index continuing to rise. it's had a pretty good year,

up 760%. and of course we have the big coinbase to direct listing later joining us to discuss, jill carlson, cofounder of open money initiative. jill, you do a lot of work into crypto space, a lot of investing in that area. does coinbase have a lock on its business, or are there new models or other competitors in this world of trading and crypto brokerages that could incur onto coinbase's space? jill: wow, you are going right for the jugular there, joe. here i have all of these talking points prepared around how coinbase is going to skyrocket, how people are underestimating it and under evaluating it. but i do think you are touching on something important here, the competitive landscape and thinking about what we in venture capital like to call the moat around business. it is certainly true that if you

look at crypto exchanges, crypto custodians and the various business models coinbase has, if you look at the landscape, whether it is across different geographies, crypto is a very global industry, a very global phenomenon. coinbase of course is, i would argue, the most relevant player in the u.s. that is not necessarily true abroad. you also have to look at new players in the space, not just the incumbents, which is kind of funny to even talk about finance and other competitors like that as incumbents, but decentralized exchanges even threatening coinbase in terms of the amount of volumes they see on a daily basis. so i think that you are going straight for the jugular there, but perhaps rightly so. it's an important thing to discuss. caroline: full disclosure, my husband is the manager at coinbase, so i know a bit about the business. but i want to know how you as an investor try to find a comparable as to how to value i

t. if you look at where the multiples of where exchanges trade, well, i mean, that would hold back evaluation a lot. but if you look at the square of a paypal or fintech, where do you think the public investor base should be looking to for some sort of a guide? jill: i think it is a great question. coinbase has been coming under a lot of scrutiny here for this $100 billion market cap valuation that people are whispering about. you have to recognize though that coinbase is a growing business. in many ways, still is a startup. it is a growing business, and it is in a growing industry that is centered around a growing asset class. and that's something, whether it's the new york stock exchange and the incumbent from the exchange side, or whether it is fintechs. square, you look at cash app as a competitor, you look at

robinhood, that is something none of those can say in quite the same way coinbase does. again, it's growing business in a growing industry. romaine: how strong do you think the first mover advantage is here for coinbase? you mentioned the other competitors, and there is always an eye on big, traditional banks, and maybe one day they will get their act together and compete in this space as well. jill: it is huge. since 2013, 2014, coinbase has really been the first stop for anyone who is looking to get into bitcoin. and they have managed to cement that not only for retail traders, but also for institutional. and if you think about those two markets that coinbase has gone after, there are certainly relevant competitors on both fronts, but they had managed to defend that position really well so far, and i would expect them to continue to do so. joe: i saw from our etf specialist here, there's now

nine applications for a bitcoin etf. we do not know if they will ever be approved. but if one is approved, why open up a corn-based account if it is easy to get bitcoin access, say, despite the click of a button? jill: i think there are a few answers to that, joe. first is there are people out there who believe in the utility of bitcoin and other cryptocurrencies who want to own it for reasons beyond just speculation and investment purposes. and then there's also the fact that, sure, even if the bitcoin etf gets passed, that doesn't open people up to the wider world of cryptocurrencies out there, and that is a big part of the appeal of the life of a coinbase or cracking, gemini, these other trading venues that offer more than just bitcoin. caroline: where do you think the most important buyer will be on

wednesday? the into -- the institutional investor or the retail investor? jill: institutional without about -- without a doubt. on the bitcoin side, not necessarily around coinbase, there are so many institutions that are still locked out of this market. we have done a really good job of bringing some of them on board, but there are still so many that do not have access. whether it is the custody solutions were not set up and onboard to trade on a platform like coinbase and who have just not have access. i think there are many who are standing outside the gates just waiting for that moment when they can have exposure to bitcoin. caroline: jill carlson, we love having you on the show. guys, i'm going to be watching more come wednesday, thursday, and friday, and about what blockchain does. i wonder if they drift off a little.

joe: i will be watching the bitcoin basis spot futures arbitrage there. romaine: are you still doing those charts? where do i subscribe to this newsletter by the way? joe: follow me on twitter. caroline: follow him on twitter. joe: bloomberg technology is next. have a great evening. this is bloomberg. ♪ his is bloomberg. ♪

carolyn: this is bloomberg technology. coming up this ever come of the chip crunch gets a white house hearing. president biden hosts semi conductor and automakers to smooth out supply chain issues. nvidia has its own plan to make server processors. we will have analysis across all