Generally speaking, if demand stays high, and existing suppliers don't increase supply, the high prices create an incentive and opportunity for new market entrants to increase the supply.

Yes everyone took Econ 101.

Now what do you think happens when developing new supply is substantially constrained by lead times?

Coz a whole lot less of you have ever dealt with manufacturing logistics.

Prices go up, until new supply comes online or demand wanes. Econ 101 is not invalidated just because you are having to go without due to high prices.

Some supply and demand curves move in days, some in months, some on years.

Yes that would be my exact point.

Yes, "quickly" is obviously industry-dependent. If they were fabricating something extremely easy to manufacture, "quickly" might mean months-to-a-year. Fabricating something very complicated like memory "quickly" might mean years.

That said, even though we might have to wait years for new supply to hit there market, we probably don't have to wait years to see signals of that. We will likely know that manufacturers are starting to build new supply long before we see the chips hit the market.

In the current environment unless people start decommissioning datacenters en masse supply will be locked up till the early 2030s IMO.

Even if you started a new fab today, it's 5 years till it comes online. The great hope here is that China's DDR5 yields represent a high reject rate of an enormous amount of new capacity that they'll dump into the market to get a sovereign capability in that area.