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“Black Swan” Event Triggers Revision to 2020 IC Market Forecast

Daniel Nenni

Admin
Staff member
“Black Swan” is a commonly used phrase in the world of finance to describe an event that is unexpected and unknowable. The recent surge of the spread of the coronavirus (Covid-19) and its anticipated negative impact on the global economy and IC market definitely fits the definition of a Black Swan event. Such events typically cause a great deal of uncertainty and that is certainly the case today.

Over a decade ago, Jeff Immelt, then-CEO of General Electric, coined the term “reset economy.” He used this phrase to describe what he expected to be a very different world following the financial meltdown and ensuing global economic crisis of 2008-2009.

Fast forward to 2020. IC Insights believes that this “reset” philosophy can be applied to the global IC industry this year following the current worldwide disruption to trade and business and the expected subsequent slowdown of the global economy due to the Covid-19 outbreak.

After enduring a steep market decline in 2019, most believed the IC industry was poised for a reasonably robust recovery in 2020. In fact, January 2020 global IC sales were up a solid 79% from one year earlier in January 2019. IC Insights had originally forecast an 8% increase for the 2020 IC market in its McClean Report 2020 that was released this past January.

However, with much of the industry based in the Asia-Pacific region—perhaps the most impacted region for the virus—the IC industry is now squarely in the crosshairs of being heavily impacted by Covid-19. IC Insights has had to step back and take a fresh look at its IC market forecast as it stands today and assess what can be expected for 2020.

Will the virus merely be a short-term event that leads to a quick V-shape recovery (Figure 1)? Is it more likely to expect a U-shaped recovery—one with a couple quarters of seasonally average growth before a stronger upturn takes hold? Or, is it reasonable to think that an L-shaped market outlook is ahead for the IC market. In the soon-to-be-released March Update to The McClean Report 2020, IC Insights will present its revised IC market forecast and discuss its current outlook for possible recovery scenarios.
Revision to 2020 IC Market Forecast.png

Figure 1

It’s time to “reset” your outlook for a new and very different 2020 IC market.
If you’ve not already done so, now would be an excellent time to subscribe to The McClean Report 2020, IC Insights’ flagship market research report and analysis of the IC Industry. Stay current with the latest developments and changing IC market conditions in this extremely uncertain year by using IC Insights’ monthly updates to The McClean Report that begin this month and extend through November.

Report Details: The McClean Report 2020
Additional details on IC market trends are provided in the 2020 edition of The McClean Report—A Complete Analysis and Forecast of the Integrated Circuit Industry. A subscription to The McClean Report includes free monthly updates from March through November (including the 200+ page Mid-Year Update), and free access to subscriber-only webinars throughout the year. An individual user license to The McClean Report is priced at $4,990 and includes an Internet access password. A multi-user worldwide corporate license is available for $7,990.

PDF Version of This Bulletin
A PDF version of this Research Bulletin can be downloaded from our website at http://www.icinsights.com/news/bulletins/
 

Portland

Active member
I think people are overreacting. There have been potent viruses we assumed were the flu in the past and I think the containment is doing more harm than the good.

For those struggling, it's another problem. Last night my placed was robbed when I was gone so people are struggling.
 
Black swan events definitely cause lots of unknowns and stress within the system. Black swans can also cause people to re-evaluate how they do business. Examples: more working from home and companies might be surprised (good or bad) by the results; less travel expenses that lead to worse/better results; changes in organizational structures that might be more flat and decentralized; etc. Crisis and Opportunity often go hand in hand; all depends on the perspective applied.
 

Arthur Hanson

Well-known member
The media have been totally irresponsible in dealing with the coronavirus outbreak. Common sense has been tossed out. UV C light is the best way to defeat the virus and its deployment could dramatically curtail the epidemic in several ways and render whole areas safe that other methods can't do economically or logistically. The world infrastructure has the capacity to produce UV C sources in several methods at large scale in a limited time. Fear and ignorance are now the rule. Several household or easily available chemicals and substances are available if you are willing to compromise and open your mind to possibilities. Alcohol, hydrogen peroxide, kerosene, even gasoline can be used as disinfectants as many household products can. In a dry environment a saturated salt solution can be sprayed and when dried, acts as a death trap for this and many other viruses whose own moisture expands the crystal, puncturing the virus. Knowledge and creativity should be used to overcome fear and ignorance. Experts say the masks should be used far more effectively on the sick to prevent the spread from coughing and sneezing than a preventive measure for only a military type gas mast has the seals that will prevent exposure. So far, thanks to the hysterical media, fear and hysteria generate more ratings than solutions and money rule many, who say they are helping, but rather feeding the problem through misinformation and promoting the misuse and wasteful use of needed resources. It's easily possible the economic damage caused by mishandling of this challenge, could directly and indirectly cause more death and suffering than the virus itself. Over population of the planet has made mankind become a cancer or uncontrolled growth that is causing much damage and nature has its own ways of striking back and this could be but one. The warning signs are in front of front of us in many ways and getting worse. This virus is but one example.

What is needed is true leadership with integrity, wisdom and knowledge. What we have now is a chain of self fulfilling prophecies fueled by fear and ignorance that must be broken before they become true. So far, no great leader has stepped foward.

We in the SemiWiki community are blessed with more talents, resources and connections than most and each of us should all put ourselves forward in our spheres of influence as our talents and resources allow. I personally have been trying to promote the use of UV C lighting as part of the solution.
 
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The media have been totally irresponsible in dealing with the coronavirus outbreak. Common sense has been tossed out. UV C light is the best way to defeat the virus and its deployment could dramatically curtail the epidemic in several ways and render whole areas safe that other methods can't do economically or logistically. The world infrastructure has the capacity to produce UV C sources in several methods at large scale in a limited time. Fear and ignorance are now the rule. Several household or easily available chemicals and substances are available if you are willing to compromise and open your mind to possibilities. Alcohol, hydrogen peroxide, kerosene, even gasoline can be used as disinfectants as many household products can. In a dry environment a saturated salt solution can be sprayed and when dried, acts as a death trap for this and many other viruses whose own moisture expands the crystal, puncturing the virus. Knowledge and creativity should be used to overcome fear and ignorance. Experts say the masks should be used far more effectively on the sick to prevent the spread from coughing and sneezing than a preventive measure for only a military type gas mast has the seals that will prevent exposure. So far, thanks to the hysterical media, fear and hysteria generate more ratings than solutions and money rule many, who say they are helping, but rather feeding the problem through misinformation and promoting the misuse and wasteful use of needed resources. It's easily possible the economic damage caused by mishandling of this challenge, could directly and indirectly cause more death and suffering than the virus itself. Over population of the planet has made mankind become a cancer or uncontrolled growth that is causing much damage and nature has its own ways of striking back and this could be but one. The warning signs are in front of front of us in many ways and getting worse. This virus is but one example.

What is needed is true leadership with integrity, wisdom and knowledge. What we have now is a chain of self fulfilling prophecies fueled by fear and ignorance that must be broken before they become true. So far, no great leader has stepped forward.

We in the SemiWiki community are blessed with more talents, resources and connections than most and each of us should all put ourselves forward in our spheres of influence as our talents and resources allow. I personally have been trying to promote the use of UV C lighting as part of the solution.


No question that this is very overblown given we barely give notice to the annual flu, under 50% of population takes the annual flu shot and it causes far more deaths that this virus. Yes, there are warning signs that these types of viruses can spread more easily; just look at the measles, chickenpox, etc outbreaks in the last few years. More people are siding with 'anti vaccine' groups setting themselves and especially children to catch diseases that long ago were put back in their box. These actions are based upon fear of inducing autism and other issues into people. Something happened in the 1980's that caused mass paranoia about safety (must protect everyone against any type of harm). A book called 'Coddling of the American Mind' is an interesting read about this phenomenon and how maturity has digressed by a few years since 1980. Trying to encapsulate/bubble-ize our population can actually cause the exact problems we are trying to protect ourselves from (ie not vaccinating can set up a much worse scenario for death). In today's world where you can access anywhere in the world quickly (plane, train, auto), rapid transmission is inevitable. 'We' should thank our lucky stars for this warning...It might cause Nation-states to rethink their border and immigration policies...slowing down with 'speed' bumps might not be such a bad thing after all (a perfect example is EC and no border checks between countries). I did not mind the various immigration checks and getting a passport stamped as I entered other European countries...It was always interesting to see the type of stamp used for entry. Did this provide better protection for me or that Country's citizens? Unsure how they used the data once they captured it....

It will be interesting to see how history looks back at this coronavirus scare and categorize how we reacted and the toll on business....this might be another 'tulip bulb' collapse....
 

Arthur Hanson

Well-known member
Every person that dies that has traces of the coronavirus has definitely died from the coronavirus, forget they smoke, have a bad diet, no exercise, have heart disease, are very old, get hit by a car, fall off a cliff, or what ever, it is definitely listed as a corona death. Most people that get the virus they have found don't even feel bad enough to go to a doctor or hospital. Like many diseases, most are just carriers or have very mild symptoms. The press and so called experts are creating the real problem, economic devastation, which will cause many health problems. Never I have I seen such an irresponsible press and so called experts. Tens of thousands have died and a staggering number injured, so we are going to ban driving and take possession of your vehicle until the problem of these deaths and injuries is solved. We will send you a bill for safe storage of this proven danger. Never have I seen mass hysteria create more economic damage in such a short period of time. I would hate to see what a determined person with a small bio lab could do. The fear is far more damaging than the problem.
 
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Every person that dies that has traces of the coronavirus has definitely died from the coronavirus, forget they smoke, have a bad diet, no exercise, have heart disease, are very old, get hit by a car, fall off a cliff, or what ever, it is definitely listed as a corona death. Most people that get the virus they have found don't even feel bad enough to go to a doctor or hospital. Like many diseases, most are just carriers or have very mild symptoms. The press and so called experts are creating the real problem, economic devastation, which will cause many health problems. Never I have I seen such an irresponsible press and so called experts. Tens of thousands have died and a staggering number injured, so we are going to ban driving and take possession of your vehicle until the problem of these deaths and injuries is solved. We will send you a bill for safe storage of this proven danger.

On point.
For decades, we have lots far more people to the annual flu while less than 50% of the population gets the annual vaccine (CDC website data). In addition, we have started to see measles and chickenpox breakouts due to people that have not been vaccinated. Highly correlated on people that get and die from measles or chickenpox and not vaccinated. Hardly any press on these (or to show why vaccines are worth it).
For the press/media, they are in it to increase their market share which allows them to raise their advertising rates: follow the money. Whether truthful or not, as long as they can sell more of their stuff, they will continue to publish AND raise anxiety which induces more to read. I know it is illegal to yell 'fire' in a theater (or thought it was)...same standard should be held against the media.

Today, WSJ had an article about Taiwan being 'kicked out' of WHO a few years ago when China entered. Given Taiwan's proximity to China, Japan and Korea along with very old family ties, you would think Taiwan would be one of the highest infected regions....Not even close and they have used technologies to triage travelers into the country based on risk levels (where they had traveled). And this is all during one of the highest Holiday seasons for them. Same article discusses Italy and how poorly they have been doing. The average age of Italy is much higher than US. In addition, 90% of all the Italian deaths are from people 70 years and older. Granted it is a shame that these people died, but it also shows that the mortality rate for younger people is SIGNIFICANTLY lower. Same for the deaths in Washington State...most from an old folks home. If we were to do anything, it would be to protect the elderly around the US....
 

Portland

Active member
In speaking about fears. Star trek Picard reimagined the Borg as ai that evolved further than "organics" but still needed their labor so they enslaved "humanity" to work in their factories. And we've already sort of enslaved to technology. So pick your apocalyptic fear viruses or enslavement.
 
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