In its February 20, 2021 edition, The Economist published an article entitled "How to kill a democracy; China faces fateful choices, especially involving Taiwan." It went on to quote "To many Chinese, the island’s conquest is a sacred national mission” as well as a byline "America is losing its ability to deter a Chinese attack on Taiwan. Allies are in denial."
The thought of this should be more than enough to send cold shivers down the chip industry's spine given, were this to happen, a pivotal part of the western world's chip supply would dry up overnight. Chip inventories would quickly become exhausted and end equipment production lines everywhere would grind to a halt within a matter of weeks, even days. The near instant impact on global trade and the world economy would be orders of magnitude greater than the 2008 Lehman Brothers crash or the 2020 Covid-19 lockdown.
This global economic risk is also arguably more dangerous than the 1960's cold war with the USSR or the 1962 Cuban missile crisis, given there is no counter-balancing western world deterrent. That card had already been played by ex-President Trump's denial of China's access to US semiconductors (e.g. to Huawei) and semiconductor-related design and production tools and equipment.
The current chip shortage, and its devastation impact on the automotive industry, has to a limited extent stirred the chip-supply hornet's nest, along with the US 'Chips for America' and EU 'European Initiative on Processors and Semiconductor Technologies' but these are poorly thought-through knee-jerk reactions rather than a concerted response to a serious global problem.
Next: Problem brewing