Key Points:
Memory has jumped from 15-18% to 35% of total PC build materials in a single quarter, per HP's most recent investor disclosure.
Apple shares posted their worst session since the April 2025 crash after the company raised prices on iPads, Macs, HomePods, Vision Pro, and Apple TV on June 25.
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Gartner forecasts that laptops under $500 will become "financially unviable" within two years if memory fab capacity does not catch up before the 2027-2028 window.
Microsoft just killed a product. Not a flop. A best seller. The 2TB Xbox. Gone from the shelves. They couldn't get the chips.
I can't stop thinking about this. Because it's not just an Xbox. It's a signal. The same thing is happening to laptops, iPads, phones. The price of everything with a memory chip is climbing fast. And I don't think most people realize where this leads.
Here's what worries me. The Fed is cutting rates to bring inflation down. But this kind of inflation? The Fed can't touch it. Cutting rates won't build a chip factory.
JP Morgan did not become the world’s biggest bank by making the wrong bets. So when they put $1.5 trillion behind energy, people notice.
Here is what they see. Every EV battery needs lithium. So do AI data centers going up right now. Demand is set to grow 5X by 2040.
But the mines cannot dig fast enough. The traditional mining takes 18 months and leaves most of the metal in the dirt.
Because the hard part isn’t finding lithium. It is getting it out…
Meet a private company called EnergyX.
General Motors led a $50 million round.
The U.S. Department of Energy added a $5 million grant.
And it gets better…
EnergyX just opened the largest plant of its kind in the country, down in Texarkana in East Texas.
At full scale, it will pull 50,000 tons of lithium a year out of the ground and generate $1 billion in revenue.
The institutions are already in. You would be buying at the same stage they did, before a public market exists to price it for you.
Ride alongside the institutions into EnergyX. Invest by July 16.
HP told investors something stunning last week. Memory used to be 15 to 18 percent of the cost to build a PC. Last quarter, it jumped to 35 percent. In one quarter. HP can either eat the cost or raise prices. Guess which one they're picking.
Micron, the big U.S. memory maker, says the price of memory chips is up 260 percent from a year ago. Two hundred sixty percent. That is not a typo. That is the kind of number you see in oil shocks. Or in war economies.
It is already on shelves. Apple raised prices on June 25. iPads. Macs. HomePods. Vision Pro. Even the Apple TV box. Across the whole line. The stock had its worst day since the April 2025 crash. Wall Street saw the price hikes and didn't cheer. They winced. Because higher prices on Apple gear means fewer Apple buyers.
Why is this happening? One word. AI.
The big tech firms are buying every memory chip they can find. They need them for the data centers that run AI. These data centers eat memory like a kid eats candy. And there isn't enough to go around.
So the chip makers are sending their best memory to Microsoft, Google, Amazon. The leftovers go to phones and laptops. And the leftovers cost a fortune now.
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Microsoft's own CFO said the company is bracing for a $25 billion hit to spending next year from higher chip prices. That is Microsoft. The buyer with the deepest pockets on earth. If they are feeling it, what about HP? What about Dell? What about you and me?
Lenovo's CFO admitted the company is now hoarding memory chips. They are sitting on 50 percent more inventory than normal. They are hoarding like it's 2020 toilet paper.
Here is the part that stings. Memory factories take two to three years to build. Nobody is breaking ground fast enough. The shortage does not ease until 2027 or 2028. We are looking at two more years of this. At least.
Gartner did the math. They say laptops under $500 will become "financially unviable" within two years. Read that again. The cheap laptop is going extinct. The one a college kid needs. The one a grandma buys for video calls. Gone.
Deutsche Bank put a label on this. They are calling memory chips "a distinctly macroeconomic variable." That is a fancy way of saying one chip can now move the whole economy. I get it. It sounds like a stretch. But the numbers back it up.
Here is the one I keep coming back to. 260 percent. The price of memory chips. Up 260 percent in a year. Nobody is shouting about it on the news. But it is bleeding into the price of every device we own.
And the Fed cannot fix it. They do not control AI demand. They do not control how fast somebody builds a factory in Korea or Taiwan. They can cut rates all day. The price of your next laptop is still going up.
This is the part I worry about most. Bond investors are betting on a smooth ride down. They think inflation eases. They think the Fed cuts. They think we glide into a soft landing. But there is a hidden tax building on every device sold in America. A quiet AI tax. Nobody is naming it yet.
I do not know how this plays out. Nobody knows. But I do know this. When Microsoft pulls a product because they cannot get the parts, you pay attention. When Apple raises prices across the whole line, you pay attention. When the CFO of Lenovo starts hoarding chips like canned goods, you pay attention.
The story everybody is telling right now is that inflation is dead. I'm not so sure.
More on this tomorrow.
— Lauren
Editor, American Ledger
