You can wrap stdin to strip the newlines; if you can strip all trailing whitespace (usually okay), then it's just:

for name in map(str.rstrip, sys.stdin):
    ...

You're on Py3, so that works as is; if you're on Py2, you'll need to add an import, from future_builtins import map, so you get a lazy, generator based map (that yields the lines as they're requested, rather than slurping stdin until it ends, then returning a list of all the lines).

If you need to limit to newlines, a generator expression can do it:

for name in (line.rstrip("\r\n") for line in sys.stdin):
    ...

or with an import to allow map to push work to C layer for (slightly) faster code (a matter of 30-some nanoseconds per line faster than the genexpr, but still 40 ns per line slower than the argumentless option at the top of this answer):

from operator import methodcaller

for name in map(methodcaller('rstrip', '\r\n'), sys.stdin):
    ...

Like the first solution, on Py2, make sure to get the map from future_builtins.

The following should just work.

import sys
for line in sys.stdin:
    # whatever

Rationale:

The code will iterate over lines in stdin as they come in. If the stream is still open, but there isn't a complete line then the loop will hang until either a newline character is encountered (and the whole line returned) or the stream is closed (and the whatever is left in the buffer is returned).

Once the stream has been closed, no more data can be written to or read from stdin. Period.

The reason that your code was overloading your cpu is that once the stdin has been closed any subsequent attempts to iterate over stdin will return immediately without doing anything. In essence your code was equivalent to the following.

for line in sys.stdin:
    # do something

while 1:
    pass # infinite loop, very CPU intensive

Maybe it would be useful if you posted how you were writing data to stdin.

EDIT:

Python will (for the purposes of for loops, iterators and readlines() consider a stream closed when it encounters an EOF character. You can ask python to read more data after this, but you cannot use any of the previous methods. The python man page recommends using

import sys
while True:
    line = sys.stdin.readline()
    # do something with line

When an EOF character is encountered readline will return an empty string. The next call to readline will function as normal if the stream is still open. You can test this out yourself by running the command in a terminal. Pressing ctrl+D will cause a terminal to write the EOF character to stdin. This will cause the first program in this post to terminate, but the last program will continue to read data until the stream is actually closed. The last program should not 100% your CPU as readline will wait until there is data to return rather than returning an empty string.

I only have the problem of a busy loop when I try readline from an actual file. But when reading from stdin, readline happily blocks.

You can use readline(), to get a single line at a time for sys.stdin. If that is inside of a generator, a simple for loop can be constructed:

def read_stdin():
    readline = sys.stdin.readline()
    while readline:
        yield readline
        readline = sys.stdin.readline()

for line in read_stdin():
    line = line.split()
    print(line)

Problem is probably due to flushing of stdin since the \n lingers on.

as an alternative, use raw_input

while True:
    c = raw_input('please enter a character: ')
    print 'you entered', c

For the flushing part, see this

for line in sys.stdin:
    ...

Or call .readline() in a loop.

It's simpler:

for line in sys.stdin:
    chrCounter += len(line)

The file-like object sys.stdin is automatically iterated over line by line; if you call .readline() on it, you only read the first line (and iterate over that character-by-character); if you call read(), then you'll read the entire input into a single string and iterate over that character-by.character.

Use the fileinput module:

import fileinput

for line in fileinput.input():
    pass

fileinput will loop through all the lines in the input specified as file names given in command-line arguments, or the standard input if no arguments are provided.

Note: line will contain a trailing newline; to remove it use line.rstrip().