#21 - Life is Like a Box of LEGOs: You Never Know What Piece You're Going to Step On

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Welcome to the last days of summer! This week we get into how data-centers aren’t slowing down, an August Freedom Fund recap, and why you should try to pursue unconditional paths in life.

Market Recap

• Tract Spends $136M On 2,100-acre Site Outside of Phoenix

  • The land-development firm is planning one of the largest data-center complexes in the nation​. Data centers fueled by AI are significantly increasing the size of land needed for their facilities.

  • Development of these large centers have created challenges in terms of securing sufficient power, managing the environmental impact, and water/energy required to cool them.

  • Large scale centers will provide many opportunities within industries such as REITs, construction/facilities management, utilities, and companies that develop advanced cooling technologies.

• Lego Revenue Jumps In First Half of Year

  • Compared to public companies Hasbro and Mattel who had revenue decreases this year, privately held Lego boosted revenue by 13% so far this year.

  • Lego and Nike ($NKE) are partnering to bring more branded items into the Legoland. Sneakerheads should expect to add more legacy Nike collectible collaboration builds to their shrine with more options than spin offs such as the Jordan 11 Concords.

  • Nike’s ($NKE) share price is down over 18% this year. Collaborations with special edition Lego releases could boost sales volumes in the collectibles market. According to Market Decipher, the collectibles market in 2024 was estimated at $492.6B with an annual growth of 9.2%.

• OpenAI & Anthropic Sign Deals with U.S. AI Safety Institute

  • The deal will allow the government to test and evaluate future model roll outs for risks as both companies are facing backlash over their models safety & ethical use potential.

  • Nividia $NVDA reported an EPS of $0.68 on revenue of $30 billion in its fiscal second quarter on Wednesday with a 122% top line growth YOY.

  • Currently the market sceptics think we are in an AI bubble and there may be some truth to it for the time being. However, given the massive infrastructure and commercial/governmental adoption of this technology it’s hard to ignore the signs of growth.

Freedom Fund Portfolio

• August 2024 - Portfolio Recap

  • Current Value: $18,744.26

  • August Dividends: $30.00

  • Dividends Paid Since Inception: $618.65

  • Total Return Since Inception: 12.24%

  • Portfolio Notes:

    • This month the Freedom Fund saw some nice appreciation in share value specifically from 2 REITs $MDV & $O. A few months back in the gazette we discussed a potential buying opportunity for REITs and how they may start to make a come back with potential rate drops on the horizon. Currently $LAND & $APLE (the other 2 REITs) have not had the same share appreciation. I will be need to start re-evaluating these two companies to see if they still make sense for the portfolio long term.

    • This month the main buying focus was to beef up my all market ETF through $SCHB to try and balance it as a higher % of allocation in the portfolio.

• Friday Freedom Fund Purchase:

  • 17 shares of $EVLV - Evolv Technologies

    • With $EVLV having recent success in the NYC subway system there is momentum gaining now on a potential pilot program with the LA Metro system. Evolv is trending not only in stadiums and school districts but also municipal transit systems from east → west coast cities.

  • 2 shares of $SCHB - Schwab US Broad Market ETF

    

• Other Portfolio News

  • $PLTR

    • Sompo Enhances Digital Transformation with Palantir's AI Solutions

    • Ukraine is developing a system with Palantir that will use A.I. to study socioeconomic and environmental conditions in the country to determine which of the war-affected lands should be demined first.

  • $EVLV - LA Metro to begin pilot of Evolv weapons detectors next month.

  • $GOOGL - Google Considering Large Data Center in Vietnam

Freedom Fund Background: I created the Freedom Fund as a public brokerage account back in October of 2022 to share that anyone with a social security # and a bank account can begin their investing journey by investing a couple hundred dollars a week. Every week and month I post on X (@GrahamInvesting) public updates about the purchases, exits, dividends, and growth of the fund if you want to follow in real time. The biggest obstacle people have to investing is just getting started so I decided to start a new account at $0 to start from nothing with you.

Quote of The Week

This past week I heard Hormozi say this line again in a podcast with Chris Williamson and it got me thinking about how much our society always waits for the perfect conditions to start working towards something. Waiting for the perfect team to start a project. Waiting for a specific rack/bench/machine to start your workout. Waiting for the proper advice/instruction before trying something new. Some key thoughts that I reflect on when I remind myself to not wait for the perfect conditions in life to get started working towards something are:

• Success Should Not Be Conditional: The quote suggests that if you wait for everything to be perfect before starting, your success is dependent on external conditions. This approach can be limiting because it places success in the hands of factors outside of your control. By allowing outside factors to constantly hold you back from starting or working towards a goal you are allowing your environment to hold you back and place influence on your growth.

• Unconditional Success Compounds: True success comes from being able to take action no matter the circumstances. By being willing to start even in imperfect situations, you demonstrate resilience and commitment. This kind of success is not dependent on external conditions. You need to lose the “when I have X I will finally be able to start Y and accomplish Z” mentality. Start finding alternative routes and get creative to get to the end goal. Paving your own way will always pay off bigger in the long run than trying to operate in a predetermined route. And it will allow you to grow your efficiency and confidence over time with more repetitions while starting something new.

• Action Over Perfection: Finally, this quote emphasizes the importance of action over perfection. Waiting for perfect conditions can be a form of fear, procrastination, and avoidance. Taking action, even when it's not a perfect scenario will lead to progress and eventually success. Action is the key foundation to all success.

What things in your life are you wanting to accomplish or work towards? What imaginary barriers are you telling yourself are in the way from taking action towards your goals? Don’t let the fear of being a beginner, not having all the answers, and your circumstances hold you back from beginning. Do the thing. Start stacking the bricks day-by-day and don’t let the conventional path hold you back from starting.

The purpose of this newsletter is to encourage you to start and stay consistent with your personal, professional, and financial journey.

Thanks for investing your time reading this.

-Graham (@GrahamInvesting)

Disclaimer: Graham’s Gazette provides information and resources related to investing, financial topics, and personal growth for educational and entertainment purposes only. The content presented is not intended to be construed as financial advice. Readers are encouraged to conduct their own research and consult with qualified professionals before making any financial decisions. Graham’s Gazette and its creators do not assume any responsibility for the accuracy or completeness of the information provided nor do they guarantee any specific results from such use of information.