I believe TSMC will diversify away from Taiwan and they will probably need to do it as quickly as they can. This is already happening; they are building in Arizona, but it takes a while to build a foundry and get it running. They should have started a decade ago. Hong Kong was probably the catalyst today. Companies who rely on TSMC will also need to diversify as much as possible as quickly as they can incase TSMC can't. I'm not sure if Berkshire doesn't think they can do it, or just doesn't like the risk. They seem fairly risk-averse.

Once this happens China will probably feel more emboldened to take Taiwan because US industry won't be so reliant on it and less likely to intervene. I'm not saying the US won't, but they would be less incentivized economically and in regards to self interest. I don't think the populace has the stomach for a long protracted, potentially nuclear war over Taiwan.

China will become significantly more isolated on the global scale if this happens, but they seemed determined to do it. They've fallen into a single-man dictatorial power structure under Xi. The China global economic experiment seems to have failed. It's a waiting game.