Mon, Jul 13, 2026|Sean Michael Cummings

The AI Build-Out Is Headed for Someone Else's Backyard

Meta Platforms' (META) $1.2 billion Cheyenne Data Center in Wyoming just lost its water privileges...

Construction started on the 715,000-square-foot campus in October. But the project hit a snag this month after a deadly bacteria found its way into Cheyenne's wastewater.

Cupriavidus gilardii is a rare, drug-resistant germ that can be dangerous to folks with weakened immune systems.

Thankfully, it only reached Cheyenne's wastewater – not its drinking water supply.

It's not clear why the bacteria was in Meta's wastewater. Still, it forced the Cheyenne Board of Public Utilities into action.

The Board halted Cheyenne's recirculated water system to prevent the bacteria's spread. It also revoked water-dumping privileges from every data-center campus connected to the city's plumbing.

What's more, Cheyenne banned the practice of flushing new data centers' cooling systems with water. This complicates any future builds that might come to the city.

Data centers can be bad neighbors... Today, a backlash is brewing among U.S. homeowners and local governments. And it's adding tailwinds to one of this year's best trades...

A recent Gallup poll revealed 71% of Americans oppose data-center construction in their area. That's even greater than the opposition to nuclear power plants, at 53%.

What's more, this opposition is bipartisan. Take a look at the breakdown of Americans' data-center approval by political party...

Roughly 3 in 4 Democrats oppose local data-center construction... as do about 2 in 3 Republicans.

This lopsided polling is showing up at the ballot box too...

In 2023, voters recalled two Port Authority officials for supporting a data-center project from Roundhouse Digital Infrastructure. The following month, the newly elected board canned the project.

In 2024, every town council member in Warrenton, Virginia who supported an Amazon data-center project lost reelection.

The AI expansion does need data centers. But Americans are overwhelmingly taking a not-in-my-backyard ("NIMBY") attitude toward the build-out.

And the friction is only growing.

More data-center projects were blocked in the first quarter of this year than in all of 2025. Take a look...

The value of the projects blocked in this year's first quarter almost matched 2025's full-year total. Take a look...

And anti-data-center grassroots organizing is also on the rise. Take a look...

The number of active grassroots opposition groups more than doubled in the first quarter compared with all of last year.

NIMBY resistance is getting bigger and more organized. So we can expect America's data-center expansion to get even more bogged down from here.

The bottom line is that investors should expect companies to build more data centers outside the U.S. And it's already happening...

Data Centers Are About to Transform Emerging Markets

Southeast Asian governments are rolling out the red carpet for data centers. In 2024, Indonesia's government revised its technology policy to support data-center industry growth. And in March, Vietnam enacted its definitive Law on Artificial Intelligence, which established a national fund for data centers.

In short, America's "NIMBYism" could fuel a boom in emerging markets. For us investors, that's a tailwind we should keep an eye on...

The MSCI Emerging Markets index has soared about 22% year to date, more than doubling the S&P 500 Index. Take a look...

Emerging markets were already soaring before the NIMBY tailwind. But the shifting outlook in data-center development will fuel continued outperformance.

Insatiable AI demand means data centers must be built somewhere. The countries that allow data centers in their backyards will be handsomely rewarded... Right now, that means emerging markets.

These economies are where the AI build-out is headed next. Make sure your portfolio is ready for this shift.

Good investing,

Sean Michael Cummings

The AI Build-Out Is Headed for Someone Else's Backyard

Data Centers Are About to Transform Emerging Markets

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