A letter at the end of summer

We write rarely, and by intention. A house that comments on everything ends up positioned for nothing, and the year has offered plenty to comment on. This letter is the exception rather than the beginning of a habit.

What has held is the shape of the thing. The recurring layer of the build-out, inference and the power behind it, still sets the economics, and the constraints we wrote about in June have not cleared. Interconnection queues are longer, not shorter. Transformers and switchgear are still quoted in years. None of that was a forecast; it was an observation, and it remains observable.

What we changed was modest. We trimmed where the narrative had outrun the cash flows, which in a few names it plainly had, and we added to the electrical and grid layer on weakness that had nothing to do with the underlying orders. Neither move was clever. Both were the consequence of a rule we set before the prices moved.

What we did not change matters more. We did not increase size because a position was working, and we did not average into a thesis that the evidence had stopped supporting. The temptation this year has been to mistake momentum for confirmation. A private house has one structural advantage over almost everyone else, which is that it never has to explain a quiet quarter to anyone but itself. We intend to keep using it.

We are not currently raising outside capital, and this letter is informational only. It is not investment advice, an offer or a solicitation.