taylor: let's take a look at how the markets performed on the day -- the s&p 500 is officially in correction territory today, we fallen 10% from some of the latest peaks. and it was a record high all he back on generate third. still a big deal because last time this happened was in march of the 20, right as the pandemic was kicking off. markets are falling, a two year yield climbing eight basis points on the day and crude oil, those inflationary concerns now with a 92 handle. why? it all comes down to geopolitics

-- russia, ukraine and the impact of a ruble looking at high volatility. you haven't seen this kind of volatility since the pandemic and the annexation of crimea. "what'd you miss?" starts now. romaine: it all goes back to the supply chain. today's triple take looks at the supply chain pain and what efforts are being done to fix it. governments and companies are attempting to tackle the issue causing shortages around the world and now geopolitical tensions adding to the pile of stress on the system. you got in the bunny suit earlier, i hope you got more insight into whether the chip crunch is being solved. caroline: who doesn't want to

put on a bunny suit for the day? this is just pressure upon pressure, a supply chain not solving itself. he noble gases used in chipmaking come from none other than russia and ukraine, so it has been front and center. this is why i have been looking at where the stress points have been. taylor: and to san francisco, where ian king is standing by. >> these phenomenon all had a similar cause -- an abrupt shortage of semiconductors. what caused the short fall? rearrange supply and demand -- when businesses shut down, businesses directed chips to computer making and when the economy started to reopen, industries like automakers that

had cut back rushed to re-up. the supply chain incapacity could not meet the surgeon demand. >> covid caused every ready to step back a bit from buildout and it induced a radical increase in demand. so you have supply chains scaling back and demand scaling up radically and now we are in a position that there is a meaningful shortage. caroline: the race for chips lead to skyrocketing what they time between ordering a chip and delivery hitting records. in response, chipmakers are playing catch-up and in the process, spending big bucks to increase capacity. >> it is a competitive world and we are going to be very competitive in the process. caroline: macron is set to spend as much as $12 billion this year, part of a broader 150 billion dollars spending plan. intel unveiled a plan to invest $28 billion. including plants in the u.s.

with hundreds of billions of dollars at stake in the coming years, the global race to expand production is in full effect. some executives say despite all the money and effort, it still may not be enough to meet the demand. >> i think for the better part of the next four or five years, our industry will be chasing the ability to put capacity online to meet not only demand in front of us today, but the growing demand. >> as companies go all in and move their chips to the center of the table, global investors are placing bets on who will prevail in the coming decades. taylor: now we will get to san francisco where ian king is standing by. talk to us about the big disruption you have seen. we talked earlier about some of the double ordering going on and maybe that is exasperating supply issues. are things getting better in the chip world? ian: sort of and slowly.

remember most of the executives we just ran clips of saying some areas, the second half of this year, other areas are still going to be short of what they need well into next year. but if you believe some of those others like pat gelsinger, this is the beginning of an extended time of supply-demand crunch because the chip industry is expanding so quickly. caroline: from your perspective, you think we are not gone from the boom-bust days? the ceo of micron says they have moved past that and fundamentals will support that. ian: that is the key question. if you are not investor, you would like to know the answer. if you look at 20 or 30 years of history, the answer would be no way this industry has suddenly in one year snapped out of this vicious cycle because of this

huge gap between the amount of time it takes to put capacity in place versus the short term supply we have seen. if you believe these guys, things are different now and we will see an extended time because chips are used in everything now. romaine: it will be interesting to see if things are front. we want to pose that question to our next guest and talk about the idea of self-sufficiency in chip production. a professor of management practice at harvard business school spent a lot of years working in the tech industry for a lot of these companies and has done some fantastic research about the potential and promise of wringing more manufacturing -- bringing more manufacturing back here. i am professor -- i'm curious about these plans -- at the end of the day, this is to late mobile economy. so may things you need to make

our products, at least for right now still have to be sourced to some degree from outside our borders. is there a vision week can do this within our own orders? >> what we are seeing right now is there buddy competing for self-sufficiency, but the supply chain is very global. not only do you have to build the chips, you have through the packaging and all the raw materials like whether they gases or masks you need for production. i think there are a couple of different segments you have to pay attention to, which is the leading edge. chips that go into iphones. then there's the trailing edge stuff where we have the real capacity crunch affecting automakers. that has suffered from underinvestment because it has not been that profitable. there are huge investments chasing after that and as ian just said, it takes time for that capacity to come

downstream. different parts of the market will see different things. can we get more self-sufficient on the trailing edge stuff? probably, but unless we bring packaging onshore and the rest of the supply chain, we are going to be interdependent globally. taylor: talk to us about the global picture. we talk about diversification globally but even internationally, we are looking at some people are worried about taiwan and are shifting to vietnam, you name it. how are you thinking about diversifying from the already international perspective? willy: we are seeing a lot of players who have been very concentrated historically. now they are putting investment into japan, into -- it has not been announced yet but europe is angling for a piece of that. you saw last week india announcing 20 billion for

investments in semi conductors. we are seeing a lot more of that globalization of some players who have historically been relatively concentrated. that mirrors the auto industry 30 years ago when a lot of big players started going global. maybe it will be spread out a little more. caroline: i'm interested whether it makes sense from an economic perspective? i was talking to the ceo of micron who set at the moment there's a 45% cost differential between making a chip in taiwan as he does or in asia versus making it here in the united states. yes, $50 billion coming from the administration in terms of incentives, but that does not make up for the costly labor and regulation. how do we get some economic parity or do we just have to brace ourselves for inflation? willy: one of the reasons a lot

of that manufacturing ended up in asia and taiwan specifically is because american investors did not like the capital intensity in the first place and we said let the taiwanese do it because they are willing to do it and we will invest in the design site. that drove them in the first place, so you raise a valid question -- how much as the commissioner of the eu calls it strategical and technical and will consumers pay a higher price for it? that is yet to be seen. romaine: there is a lot more discussion in circles then we have been talking about a few years ago. when you look at the strategic vision of this, is there a way forward where may be the u.s. solidify some sort of partnership with europe or some other regional block where it can add more reliance on the

sustainability of that relationship? willy: i think we are heavily interdependent with europe and japan with tools and raw materials, so i can envision drawing a circle saying i have a fairly complete deck to play with. but to think we are going to be completely self-sufficient and pull up the drawbridge is, i don't think that's realistic in the near term. romaine: really appreciate you taking time to be with us. helping to kick off our discussion today. we will go back out to boise, idaho and talk about supply chain issues and the growth of boise as a major hub. the mayor will be joining us in just a minute. this is bloomberg. ♪

caroline: all day, we have been at the micron headquarters in boise, idaho to talk about supply chain issues and how people are starting to manufacture more within the u.s. or intend to. not just in silicon valley, perhaps looking to idaho, the fourth in growth among u.s. states right now, tech in particular grew 61%. the tech sector grew more than twice the national average in 2017 and 2018. we've seen 20,000 people working

in this particular state, you have micron, healer -- hewlett-packard has a printing business here. we have a lot of other companies buying up -- eyeing up idaho and boise in particular. why do you want to live here? home prices were that much more affordable, at least more than san francisco, are higher. taylor: and with those companies, how do you attract the talent? let's get some insight from a transplant herself, the mayor of boise, idaho. you grew up in boston, new york and houston and finally ended up in idaho. what can you do to make sure companies and the brain talent can follow to your idaho? mayor mclean: what we have done here in boise throughout the last two decades is create a community that welcomes everyone and supports the technology

sector that makes those jobs available. i move here right out of college, so this is the one home i've had as an adult and it was the technology space that recruited my husband and i to move here. and as in -- as has been mentioned, just as micron has grown, the technology sector has grown here as well. romaine: give us a sense for those not familiar with boise, what is the attraction for companies like that? what's the attraction for employees to come there? why are they choosing their as opposed to other coastal hubs? mayor mclean: we have a community that welcomes everyone and micron has helped lead the way when it comes to creating an inclusive and diverse community. we great landscape with a beautiful, clean river and open space for folks to enjoy and growing economic opportunity as the tech space in particular continues to grow. whether it be small companies that started out in last 10 years that have grown or been

acquired or companies that have grown alongside the city like micron. taylor: we have been speaking to clearwater as well. i just flew into the boise airport. it's fantastic, but is it enough when you start to see more and more people coming? they are looking at stress on the hospitals -- what are you making sure to that the standard of living remains intact? mayor mclean: we passed a massive water bond to make sure our water remains clean and we can create the infrastructure we need. we are piloting a clean water renewal project with micron. housing is really important, just as every community around the country is grappling with the rising cost of housing, we are making sure we have great education, good workforce, partnership with business and industry helping us address affordability and creating

economic opportunity for the future for the residents who are here and then welcome more that are coming. taylor: talk about the fundamentals of a city -- rising property taxes, sales taxes can help, but you are known for being one of the lower tax states. how are you thinking about financing this and balancing a budget? mayor mclean: we in idaho and particularly in boise find ourselves with great financial management. our budget can only grow a certain on every year and we prioritize investments that keep the level of quality of life and level of service our residents come to expect in our budgeting. of course, we have to work with industry, other agencies and the state to do what is needed to address affordability, workforce development, to make sure our kids are educated well and prepped for jobs in the future all while doing what idahoans do

well which is budget for a family. caroline: a lot of employees telling me how much they love the skiing and fresh air. thank you so much for hosting us and being part of the wonderful boise, the mayor of boise, idaho. taylor: on days like today, it's always about geopolitical events. we want to bring you some headlines -- secretary of state antony blinken is speaking with ukraine's foreign minister. putin's speech on separatists regions, he says it is deeply disturbing. really trying to understand and be more supportive of each other as we think about russia's next move. you can continue to follow that on live go and we will bring you headlines as they come. this is bloomberg. ♪

romaine: breaking news -- the planned meeting between secretary of state antony blinken and his russian counterpart has been called off according to antony blinken, saying the meeting has been canceled and it does not make sense to have a meeting with him. we will keep an eye on on this as geopolitical tensions continue to ratchet up between russia and the rest of the world. as countries around the world grapple not only with geopolitical issues, a lot of supply chain shortages, some countries like taiwan and south korea are set on self-sufficiency. >> from south korea to taiwan to japan to china, semiconductors are a critical component of asian economic output and, let's face it, growing political thanks. samsung electronics can be considered chip king, dethroning

intel as the world's biggest chipmaker in terms of revenue for the first time since 2018 with 13% of the global semi conductor market share after chip sales soared more than 31% in 2021. it had another quarter of record sales in the fourth quarter and will spend tens of billions more on the most advanced chipmaking technology. global demand has never been hotter and the chip shortages are seen worldwide. the rise of samsung and others combined with the pandemic ribbon supply chain pain and what we have seen with rising u.s.-china tension that have elevated china's plans to develop self-sufficiency in chips have heightened anxiety that the u.s. could be left vulnerable as critical industries shift its centers of gravity here to asia.

caroline: the global perspective of the supply chain headache. let's take a final take-two recap although the great names we've talked to over the last three hours. take a listen. >> we certainly expected supply chain shortages will continue to improve during the course of the year. in certain categories, the rate of improvement is behind what we were hoping for. >> the supply chain keeps getting better, so let's talk about this morning. there were 76 boats in the l.a. harbor versus 105 when i sat down with you in december. >> it is finding drivers, getting trucks, sometimes the cost of fuel. >> the biggest headache our members have today is driver shortage. also personnel shortage.

they are short mechanics, short dispatchers, so it is all around. >> at a certain point, when the supply chain normalizes, private labels could take more share. but at this point, the consumer seems to be taking the pricing all too well. taylor: that does a good job of kicking us off on our final thoughts on a day when the supply chain is in focus and inflationary pressures are in focus. all of this stemming on geopolitical events. romaine: when you look at the geopolitical event, it is a reminder of this idea that maybe self-sufficiency is even possible in a world where we are so well connected. caroline: willie at harvard saying the same thing -- this is right it's more about ensuring you have a diversified supply

chain. not just one country. romaine: could we put up a picture of caroline and the bunny suit? there we go. i love our producers. caroline: there we are. romaine: you should keep that bunny suit. that wraps it up for "what'd you miss?" full -- bloomberg technology is coming up next. this is bloomberg. ♪

announcer: from the heart of where innovation, money, and power collide -- in silicon valley and beyond, this is bloomberg technology with emily chang. caroline: i'm caroline hyde in for emily chang and this is bloomberg technology. we are live in boise, idaho at the micron headquarters. we had a sit down with the micron