台积电 and AI-related Korean stocks are creating wealth for this generation of ordinary East Asians

Original article fromWSJ

Compiled by / Odaily Planet Daily Golem (@web3_golem)

Na Se-bin has completely lost her sense of spending.

Since January this year, attracted by the global AI boom, she has invested almost her entire life savings (about $47,000) into the stock market. This boom is driving tech giants in South Korea, Taiwan, and Japan to rake in massive profits.

The 24-year-old South Korean programmer says that during periods of extreme market volatility, she could make or lose the equivalent of a month's salary in the span of a single second. Despite the huge risks, she couldn't resist, especially after seeing the value of her holdings double. Over the past 18 months, the South Korean stock market has been one of the best-performing globally. Na and her colleagues joke that they should sell their underwear to buy more stocks.

"Even friends who never touched stocks before are getting in now," Na said. "Everyone is speculating on something."

Na Se-bin, a 24-year-old software developer in Seoul, started investing in January and quickly became addicted. (Image source: Tim Franco, for The Wall Street Journal)

Trillions of dollars are pouring into the global construction of AI, which relies on semiconductors and chip manufacturing technologies provided by a few Asian exporters. The surge in global chip demand seems endless, driving growth in exports, corporate profits, and the wealth of numerous investors.

Despite recent pullbacks, Taiwan's stock market has doubled in market capitalization over the past year, South Korea's market has tripled, and Japan's Nikkei index has surged over 80% in the same period — three times the gain of the S&P 500.

The accelerating demand for AI-related products is fueling investor enthusiasm and pushing up salaries. In Taipei, taxi drivers trade stocks while driving. In the job market, high tech salaries are particularly enviable. One of the most effective "icebreakers" in Taiwan now is telling someone you work at TSMC, the world's largest chip foundry and one of the most generous local employers. Employees at Samsung Electronics' memory chip division are expected to receive an average bonus of around $400,000 this year, and the company projects its 2026 profits will surpass any global company except Nvidia.

Whether or not OpenAI's ChatGPT, Anthropic, and SpaceX can fulfill the promise of commercializing AI services, this segment of the tech industry seems destined to benefit. These Asian tech giants provide indispensable hardware for the AI industry, acting as the "picks and shovels sellers" in the AI gold rush.

The four major Silicon Valley hyperscalers — Microsoft, Meta Platforms, Amazon, and Alphabet's Google — plan to spend up to $670 billion on AI-related capital expenditures this year. This spending level far exceeds that of the US railroad expansion in the 1850s (inflation-adjusted) and the decades-long construction cost of the US interstate highway system launched a century later.

According to a report from Allianz Trade, global exports of AI-related products last year neared $4 trillion, with Asia accounting for two-thirds. These products include semiconductors, data storage servers, and cooling systems.

Market research firm Gartner forecasts that direct spending on AI this year, covering services, infrastructure, and software, will reach $2.6 trillion, a 47% increase from 2025. Next year, this figure is expected to hit approximately $3.5 trillion.

Nvidia CEO Jensen Huang, head of the top US chip design company, recently concluded an 18-day high-profile visit, attending a series of events, speeches, and business meetings in Taiwan and South Korea.

In Taipei, convenience stores sell lottery tickets offering a top prize of 500 Nvidia shares. Huang announced plans to invest $150 billion annually in Taiwan, calling it the center of the AI revolution. In South Korea, he signed cooperation agreements with local companies in robotics, memory chips, and AI.

During Huang's visit to Seoul, the KOSPI index plunged over 8% on June 8, triggering a trading halt after a selloff in US chip stocks, including Nvidia. Huang, wearing his trademark leather jacket even in Seoul's summer heat, was unfazed by the drop.

"Everyone should be very happy with the current stock price," he said, "because now you can buy stocks more cheaply."

Top 10 global stock markets by market cap in 2026 and the share of TSMC and SK Hynix in their respective domestic markets

Na, who started trading stocks this year, estimates that over 80% of her social circle is actively investing, including her colleagues. She said one colleague made so much money from stock investments that they spent tens of thousands of dollars on a wedding ring.

Now, Na is "free-spending" on concert tickets, designer clothes, and treating her parents to dinner. She originally planned to buy her mother a gold ring to celebrate her parents' 30th wedding anniversary, but her mother refused.

"She told me to just give her cash," Na said, "so she could buy stocks."

TSMC Elevated to a Pedestal

Yeh Lun-hao, a 37-year-old insurance agent, invests more than half of his roughly $2,100 monthly salary into local AI and chip-related companies. His investment returns have quadrupled, and he recently bought a four-bedroom apartment in Taichung, Taiwan, for about $440,000.

For years, his friends steered clear of the stock market. Now, they constantly ask him for investment advice.

Yeh Lun-hao, a 37-year-old insurance agent, sits in the lobby of his apartment building in Taichung, Taiwan. (Lin Yifei for The Wall Street Journal)

"Without semiconductors, none of this would have happened," Mr. Yeh said. "Investing has allowed me to step back from just struggling to survive and enjoy the beauty of the world."

TSMC is the main driver of Taiwan's stock market surge. According to Counterpoint Research, the company captured over 90% of revenue share in the most advanced chip manufacturing last year. TSMC is the world's seventh most valuable company by market cap, exceeding $2.2 trillion, surpassing Tesla and Meta.

The company's stock price has more than doubled over the past year, pushing the Taiwan Weighted Index past comparable markets like France, the UK, and India.

The chipmaker accounts for over 41% of the Taiwan Weighted Index. In contrast, the seven tech giants — Apple, Microsoft, Alphabet, Amazon, Nvidia, Meta, and Tesla — together make up roughly one-third of the S&P 500.

A low-level TSMC engineer's salary can be three times that of equivalent positions at other companies. Choc Chiang, co-founder of Taipei recruitment platform WeFer, says some managers poached by TSMC from smaller firms have seen salary increases of up to 30%.

Wang Tsan-lung, owner of a high-end liquor store in Zhubei, Taiwan, has supplied TSMC multiple times. He once sold a bottle of Napa Valley whiskey to TSMC founder Morris Chang. Now, his shop is too small to meet TSMC's demand. "We look up to them," he said, "with awe and respect."

Wang Tsan-lung, owner of a liquor store in Zhubei, Taiwan, sells large quantities of alcohol to TSMC. (Lin Yifei/The Wall Street Journal)

Wang Wei-wen earned an engineering degree in Taiwan. One of his course assignments involved visiting a TSMC factory, where the base salary is around $62,000 per year. He said such pay was unheard of, and "every household talks about TSMC."

Now a graduate student at the University of Michigan, he has also received calls from TSMC recruiters. Although Wang Wei-wen has concerns about the company's demanding work hours, he sees benefits beyond the generous salary. The social status of being a TSMC engineer is highly attractive to Taiwanese parents who are very selective about their daughters' suitors.

"Your opening line can simply be 'I work at TSMC,'" Mr. Wang said.

Products bearing the TSMC logo also fetch high prices on the secondary market. A rice cooker with the company logo and circuit board design sells for around $312 on e-commerce platforms, more than four times the price paid by TSMC employees. Buyers scramble for TSMC luggage, tumblers, and shoes. Even the red envelopes given to employees during holidays are sold online for nearly $15 each.

A Carnival for Ordinary People

The South Korean market is dominated by two chip giants, Samsung and SK Hynix, which dominate the production of two main types of memory chips critical for AI computing and data storage.

Customers queue outside a Cartier boutique inside the Shinsegae Department Store in Seoul; Samsung Electronics campus. (Tim Franco for The Wall Street Journal)

Both companies recently crossed the trillion-dollar market cap threshold, accounting for more than half of the total market capitalization of the KOSPI. The KOSPI was the world's best-performing index last year and continues to lead global rankings this year.

Choi Sung-ho, a 35-year-old primary school teacher, is among the beneficiaries of the South Korean stock market. Over the past year, his portfolio of South Korean stocks, including an ETF tracking semiconductor stocks, has grown nearly fivefold, exceeding $300,000. He says he has upgraded his mobile devices and plans to spend six figures on his next car, possibly a Mercedes S-Class or a Tesla Model X.

"Even the kids at my school talk about their parents being happy with stock profits," Choi said.

In the first three months of this year, South Korean brokerage Toss Securities opened over 180,000 trading accounts for children aged 18 and under. These accounts require parental approval to open and allow children to trade independently. Recently, the company launched a promotion offering $14 in trial funds for new accounts opened by high school students.

On YouTube, the "ETF-explaining Bro" channel is one of several emerging "finfluencers" offering market advice. Channel owner Park Soo-in said the channel has attracted over 127,000 followers since launching last July. "Many people seem to believe this rally will continue," she said.

The rising stock market has further boosted an already strong luxury goods market. The Cartier store inside a major Seoul department store is so crowded that some jewelry from its "D'Amour" collection is now only available for online purchase.

Lim Chae-hoon, sales director at a BMW dealership in Seoul, says his customers frequently mention profits from the stock market rally. "More people definitely have money to spend now," he said.

Lim Chae-hoon, sales director at a BMW dealership in Seoul, says customers now feel financially comfortable. (Tim Franco for The Wall Street Journal)

In Japan, Toyota, the most valuable company for 22 consecutive years, was replaced this month by SoftBank Group, which has invested heavily in OpenAI and data centers.

SoftBank's dominance was short-lived. Last Friday, little-known memory chip maker Kioxia jumped to the top spot. A year ago, Kioxia's stock price was around $14; now it's about $600. Kioxia's success has sparked a hunt among investors for the next potential market blockbuster.

Even Japanese luxury bathroom fixture manufacturer TOTO is profiting from the AI boom. Its high-tech ceramics are used to secure silicon wafers so they remain stationary during circuit etching. The company's stock price has more than doubled.

Another company, Ajinomoto, uses a byproduct of its globally renowned umami seasoning to make insulating film for AI chips. Its stock price has risen 50%.

Ryoki Nao, a 21-year-old top semiconductor engineering student at a university in Kumamoto, Japan, sees his classmates investing but chooses not to. While he follows market developments, he plans to graduate and find a job first before considering investments.

"I want to wait until I have earned a substantial income before investing," he said, but the market frenzy may not wait for him.