I keep reading that semiconductors are on the cusp of a downturn and that the earnings multiples for eg AMD and Intel stock are too high as a result.

In contrast, there seems to be a crazy amount of investment going into fabs and improving chip processes.

These two things don't sound like they can both be true to me. Out of the two, surely the folks pitching 100B into building out their fabs have a better insight into demand than financial analysts.

Is there any way that this investment would make sense with a downturn in chip demand (/ is there some wall st malarkey going on / some other explanation that would make everyone's behavior congruent)?