From regulatory pressures to economic headwinds, the technology sector is facing an increasing wave of risk. Patrick Moorhead, chief analyst at Moor Insights & Strategy, joined TheStreet, opening up the biggest threat facing the industry.
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The following complete video transcript:
Conway Gittens: What was the biggest risk facing the technology department at that time? I don’t necessarily talk about stocks, but the technology field?
Patrick Morehead: Yes, the biggest risk facing technology sectors now are regulatory bans and tariffs. Tariffs are a great way to inspire people to have more manufacturing onshore, but when you actually have to be onshore and build a factory, it gets really ugly. This is a good example. Trump hopes to tax TSMC and Taiwan 25% to 100% of the chips. The challenge is that it takes 3 to 4 years to build a leading chip factory, so it is impossible to actually adhere to this.
Many people say it is a negotiation. I do believe it is. But with the tariffs, you will see prices rising. As prices rise, people usually buy less. Therefore, this is the risk to the market. Yes, I would say that was number one. That is the first risk. I don’t think there is any risk of interest rates falling. We cannot own a home at 7% grain price and interest rates are not falling. And if inflation is stabilized again, we can’t forget that most things have risen 20% to 25% over the past four years, and what’s happening is housing and energy, they’ll buy less goods, which means Everyone will retreat.
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