Dear Fellow Investor,
Good morning. Happy Saturday!
I hope you're getting a slow morning and a good cup of coffee after the week we just had.
Because what a week it was.
But first, let's talk about what really happened to the market after Tuesday's election.
A Two-Day Whiplash
Democrats had a big night on Tuesday.
They flipped seven Senate seats.
They picked up at least 39 seats in the House.
And they won five governorships.
Wednesday, Wall Street cheered.
The Dow rallied 1,569 points.
The S&P 500 had its best day in three months.
Then Thursday happened.
The Nasdaq fell 5.56% — its worst day in 19 months.
Nvidia dropped more than 9%.
AMD and Micron each fell more than 17%.
Trillions of dollars of market value, gone around the world, in about 48 hours.
And it didn't stop at our shores.
On Friday, Japan's Nikkei and South Korea's market each fell about 6%.
Taiwan's market was down more than 8% at one point.
CoreWeave, one of the hottest AI infrastructure names of the past year, closed Thursday just barely above its IPO price.
Same election. Same results. Two completely different reactions.
So what changed?
The Real Story Was on the Ballot
It wasn't the House or the Senate that spooked investors.
It was the fine print.
Across the country, voters weighed in on 41 local ballot measures about data centers.
They sided with limiting data centers in 40 of them.
Five communities banned them outright.
Others passed partial bans, moratoriums and new zoning rules.
In Texas — home to a big share of America's data centers — the new governor-elect said the state will introduce laws to protect local communities from more of them.
That's what Wall Street woke up to on Thursday.
Not a recession.
Not a collapse in earnings.
A message from voters.
In fact, the economy sent the opposite signal on Friday.
The October jobs report came in at 165,000 new jobs.
Economists expected 59,000.
Unemployment slipped to 4.1%.
That's not an economy falling apart.
Why Voters Are Angry
Here's the part most of the coverage skipped.
People aren't angry at artificial intelligence.
They're angry at their electric bill.
Data centers eat enormous amounts of power and water.
When one moves in next door, the local grid gets squeezed.
And families feel it every month when the bill shows up.
Put a giant building next to a small town, have it draw as much electricity as a small city, and then watch the town's bill go up.
You don't need a poll to know how that vote turns out.
I've said it here many times.
When people can't afford what they could afford six months ago, they vote for change.
That's exactly what happened Tuesday.
So the question for investors isn't whether AI is real.
It is.
The question is where the power is going to come from.
What I'd Do Now
First, don't panic.
By Friday, chip stocks bounced about 4%, and Nvidia was back in positive territory for the year.
Panicked investors sell first and ask questions later.
I've watched this movie too many times.
The crowd always overreacts on the way down, just like it overreacts on the way up.
Second, remember the history.
We wrote about it last month.
Since 1950, the S&P 500 has been higher in the 12 months after every single midterm election.
Markets hate uncertainty — and the uncertainty is now over.
Investors were revving at 4,500 RPMs all election season.
Now they know who controls Congress, and they can get back to the fundamentals.
And the fundamentals — earnings, jobs, spending — are still holding up.
Third, follow the bottleneck.
This is the lesson I keep coming back to.
In every boom, the money that lasts goes to whatever everyone has to go through.
The bottleneck in AI used to be chips.
Now it's power.
And the companies that can deliver clean, cheap, local power — without raising anyone's electric bill — just became the most important companies in this entire buildout.
Follow the Power
That brings me to something I've been watching very closely.
In a valley in Utah, one drilling crew just cracked a fuel source Big Oil spent fifty years trying to bury.
It's tied to a Department of Energy drilling initiative.
It's backed by Google, Berkshire Hathaway, and the Pentagon.
And it runs day and night, no matter what the weather does.
Voters just told Washington they want power that doesn't break their budgets.
This might be the answer.
One small company sits right at the center of it — and the timeline starts November 17th.
Here's the full story and the company behind it:
Have a wonderful weekend.
I'll see you tomorrow.
“The Buck Stops Here,”
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Written by Dylan Jovine