Freedom Calls: 22/9/25, “Cody the horse whisperer…. and batten down the hatches in HK!”

From the team at Freedom Asset Management

No two weeks are the same in this business.  Straight off the plane from London, I took Cody and Bryce to meet some of the most beautiful Arabian horses at the Abu Dhabi desert stud farm owned by a long standing friend of the firm.  24 hours earlier we had been working our way, suitcases in tow, through the angry rabble protesting in London’s Trafalgar Square.  The serenity and hospitality of the UAE is something to behold.

Picture: Cody, the "horse whisperer”, talks revolutionary tech at a desert stud farm in Abu Dhabi, Sept 2025

Another week, another set of disappointments for the left-leaning press

It must be very frustrating these days being a left-leaning journalist (especially at the FT and the Economist).  The markets just don't seem to care about the things you care about.  We are in the business of making money for our clients, not promoting political ideologies.  We are realists, not politicians.  Was the court right to stop Lisa Cook’s immediate removal from the board of the Fed on the grounds of undue process? Probably.  Can Lisa Cook hang on to her job as a board member of the most important interest rate setting body in the world after almost certainly lying on her on mortgage applications in order to obtain lower interest rates and possible tax benefits? Probably not.  That’s just reality, not politics.  In the meantime, the markets keep going up - they don't care.

The problem the Democrats created by weaponizing the legal system against Trump under the Biden administration is that this is all coming back to bite them now.  The Democrat-led DOJ took the misdemeanour of Trump possibly not being entirely truthful on his corporate loan applications to Deutsche Bank (where no party had complained or defaulted) and turned it into a felony through a novel court process, so that they could characterise Trump as a “convicted felon” ahead of last year’s presidential election.  The Lisa Cook case is the first payback of many I suspect; nobody would have cared about this level of “fraud” if the Dems had not gone after Trump for essentially the same thing.   Where was the outrage from journalists when the DOJ went after Trump….?  Mmm… I think you know the answer.

The market does not believe the Fed on US interest rates by end 2026

There is a debate opening up on the magnitude of interest rate cuts coming in 2026.  The market thinks short term rates will be at c.2.85% (from the current , whereas the Fed is estimating c.3.4% (see below).  Whilst it is inevitable that short term rates will fall a little from here, given the possible inflation risks out there, it is not clear to us that short term rates will fall as far as the market expects.   This is something to keep watching.

Source: WSJ, 20/9/25

Interestingly, one of the comments of last week that kept on coming back was: when you are investing in revolutionary technology for the next 10 years, it really does not matter if the Fed cuts an extra 25bps here, or there - it’s just a bit of noise on that wonderful rollercoaster journey.

AI is the real deal … but the jury is still out on blockchain

Many of the conversations that we have been having over the last 2 weeks have been about AI and “is it real?”.  The answer is a resounding “yes”.    And a way to look at this is in the context of blockchain.  About 10 years ago we were all enthralled by this new technology called the blockchain.  Roll the clock forward 10 years and there is nothing in my life where I need to use the blockchain, nor has it made me more productive.  I still have the same bank account (with a bank that has been around for 100+ years), I still pay for things with my debit card…. the blockchain has not freed up my time from tedious repetitive tasks.  The blockchain for all its excitement has only really given us BitCoin and stable coins… outside of that, we don't yet have atomic settlement in securities markets…. and does anyone remember NFTs (Non Fungible Tokens)?  I didn’t think so!

In contrast, AI landed almost 3 years ago with the "ChatGPT moment”, and almost every major business is adopting AI in some way to make themselves more efficient and productive.   The winners in AI are everyone - it is a very democratic and accessible tool - the first losers ironically are the software coders… and maybe some of those journalists.  As an example, you can now build a website with a 10 second verbal prompt that then whirrs away in the background and about 30 mins later you have a fully functioning website.  It is quite amazing to see!  At a cost of about $1.

We are going to be organising an investor webinar where we go through this technology live and demonstrate the power of AI.  Please look out for the invitation shortly.

Performance - onwards and upwards

All public market strategies were up on the week, and we are "back in the green" in Sterling YTD as well.  Not even the resurgent cable (GBP/USD) can hold us back.  When gravity does strike cable, that will be a lovely uplift for our Sterling based investors, but don't leave it too long.

USVIP powered ahead as the world comes to terms with the reality of AI.  This is a train you don't want to miss.

We will be adding a new institutional strategy to the public markets list below from next week - this is the Palm Harbour Global Value fund, which we are taking out in the UK and Europe right now and has already grabbed the attention of major allocators.  We will have an article on this strategy next week.

Capital at risk.  Source: * Estimates Freedom Asset Management as at 20/9/25. Please note depending upon how the funds are invested a small number of underlying funds can price 1-2 days after we take our estimates above so final published NAVs may vary.  Estimated GBP returns are from a $1.25 FX rate on 31/12/24.  Please note launch date of USVIP 10/2/25, ** Note fund prices quarterly and includes 5% discount to NAV expressed as 5% performance above for 2024, *** FT Markets as at 20/9/25, I shares.

Our articles this week:

• Cody Willard talks to “Why we are focused on the US right now"
• Justin Oliver writes about “Elon, can he deliver for Tesla shareholders?"

We have landed in Hong Kong for the final leg of the Cody/Bryce round the world tour apparently brushing shoulders with a typhoon, so we will see how that plays out …. (see below) this is what’s coming Tuesday night…

Source: Windy.com Prediction as at 22/9/25 for Tuesday night.

Apologies about some of the formatting this week; Microsoft dropped a new version of Outlook for Mac last week, and as with all things Microsoft, it is not without its bugs.

Wherever you are this week, please let me wish you a wonderful, safe and peaceful week ahead.  We are buying umbrellas!

All the best,

Adrian

Co-Founder // Freedom Asset Management

Guernsey // Abu Dhabi // Hong Kong

M: +44 7781 40 1111* // M: +971 585 050 111 // M: +852 5205 5855*  (*also WhatsApp)

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"Why We're Focused On The US Right Now”, 22/9/25

By 10,000 Days’ Cody Willard, Adviser to the US Technology VIP Fund

We've been on the road this week in London, Guernsey, Abu Dhabi, Dubai, and now Hong Kong meeting with some of Freedom's wonderful clients.  We always learn so much from these meetings and we are truly grateful for the opportunity to meet with, learn from, and share our thoughts on tech and investing with such interesting people.

The name of our fund is "US Technology VIP," and it's not surprising that we're often asked about our views on geopolitics and the relative strength of the world's economies. Clearly, we live and work in America, and most of the current portfolio is dominated by large American tech companies, but that's not to say that we are blindly focused on America.  In fact, we actively monitor the worldwide tech landscape including startups across Asia, Europe and the rest of the world. After all, we are focused first and foremost on Revolution Investing, wherever those tech Revolutions might be taking place.

At the moment, it is clear to us that the overwhelming amount of innovation and value creation in technology is happening in the US.  We often say we are in the first or second inning (or in the first 15% or so for those not familiar with American baseball references) of The AI Revolution.  And at this moment, large American tech companies are basically the only entities on the planet that have the right mix of capital, talent, technical know-how, and access to chips needed to build the platforms underpinning the AI Revolution.

For context, the big cloud companies' (GOOG, AMZN, META, MSFT, ORCL, and CRWV) cumulative spend on AI-related capex will be just north of $400 billion in 2025.  To get an idea of how big that number is, that's roughly equal to the entire GDP of Hong Kong this year!  Critically, the big AI spenders are funding nearly all of this capex with existing cash flow, which is a big difference from the spending in the dot-com days where most of the funding was OPM (other people's money) coming from the likes of VCs and IPOs.  So most of the world simply cannot afford to build the massive infrastructure needed for AI at this moment.

Second, the US has a huge advantage in terms of its AI talent and the talent pipeline. China comes in at close second, and that's the country's best advantage in the Great AI Race.  But most of the leading AI research and development is coming from the US. And most of the world's leading talent would like to come to the US to build their companies because of the unrivaled access to capital, talent, technology, etc.  This creates a powerful, self-reinforcing flywheel for US-based innovation.

Third, the US has a relatively unregulated market when it comes to AI and technology more broadly. While there are some impressive startups coming out of Europe (e.g. Mistral, Loveable, and ElevenLabs) and China (DeepSeek and Unitree), these companies are not at the forefront of building AI Infrastructure, and those countries have much stricter regulatory environments.  While we will probably start to get some AI Regulation in the US soon, for now, it's the wild west, and that means unrivaled opportunities to build and grow disruptive, Revolutionary companies.

Perhaps most critically, the opportunities for innovators in the US is unmatched around the world. Incentives matter, and compared to every other country, the US generally does a good job of incentivizing value creation.  It's only in the US that a person has a reasonable opportunity to become a trillionaire in tech (Elon Musk, for example, with his recently proposed $1 trillion pay package). While there will surely be some successful entrepreneurs in tech from other countries, in the US, there is basically no limit to how wealthy you can become if you generate lots of shareholder value. And that matters to people like Elon Musk, Jensen Huang, Sergey Brin, Sundar Pichai, Satya Nadella (all immigrants) and countless others who moved to the US to start/build companies. By the way, as Tesla shareholders, we are perfectly fine with Elon becoming a trillionaire if he hits the extraordinary benchmarks required to do so (like taking Tesla to a $8.5 trillion market cap).

As we move into the later innings of The AI Revolution, we expect to see more successful non-US companies, like the many startups that will be built upon the American AI platforms. AI makes it 10-100x easier to build a company these days, and we are confident that there are many 18 year old kids in garages around the world working on the next Google or Salesforce or Amazon.

As we often say, the US remains the cleanest shirt in the global dirty laundry, and along with the persistent strength of the US dollar as the world reserve currency, we expect capital and talent to continue to flow into the US which will propel The AI, Robotics, and Space Revolutions forward. Accordingly, we'll continue to stay focused on US equities for now, with a keen eye on the startups coming out of the rest of the world.

Cody Willard

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“Elon, Can he deliver for Tesla shareholders?", 22/9/25

By Canaccord’s Justin Oliver, adviser to the Opus Global Growth Fund

Tesla’s CEO Elon Musk made headlines by recently buying $1 billion of Tesla’s stock. The acquisition of the shares preceded the company’s board of directors’ proposal granting him a potentially massive pay package, which includes shares that could be valued at $900 billion.  Shareholders will vote on the package on November 6.

Before the board’s decision, Musk had noted in a tweet that he might not continue to develop AI as part of Tesla if he isn’t given a larger stake in the company. The board obviously caved.  Musk owned 19.7% of the company as of August 29.  If he reaches the goals that the board laid out for him, Musk will earn an additional 12% stake in the company, according to a September 16 article in the Los Angeles Times.

To collect his payday, Musk must complete a gigantic task list: deliver a total of 20 million vehicles; place one million robotaxis into commercial operation; reach 10 million active subscriptions to Tesla’s full-self-driving functionality; deliver one million “bots”; increase earnings before interest taxes, depreciation and amortization to $400 million a year; and increase the company’s market value to $8.5 trillion. Musk also will need to develop a succession plan for the company and wind down his political involvement.

Here’s a look at where some of those elements stand:

(1) Cars. Tesla has already sold roughly 8 million vehicles, so reaching the goal of 20 million vehicle deliveries should be accomplished in less than seven years, the LA Times article suggested. The risk is that competitors are coming to market with snazzier, sometimes less expensive electric vehicles (EVs) that can travel longer distances on one battery charge. One major competitor is China’s BYD where, in some countries, certain vehicles are offered with price tags of only $20,000.

(2) Taxis. Getting one million robo taxis into operation seems an even more challenging goal. The company has rolled out only 20-30 prototypes this year, in Austin, Texas, and human drivers remain behind the wheel. That said, Morgan Stanley’s analyst Adam Jonas gave the company’s full-self-driving software rave reviews after taking a 1,400-mile trip from New York to Michigan and back in his Model Y, a September 15 article in Teslarati reported. He reported that full-self-driving handled more than 99% of the driving (he took control during two heavy rain storms and in one fast food parking lot).

(3) Making robots. Musk is excited about Tesla’s opportunity to sell robots, a business he expects ultimately to represent 80% of the company’s value. To be successful, however, he’ll have to compete against US companies like Boston Dynamics as well as many Chinese companies developing robots at very low prices. Videos, posted on X, show the latest Tesla Optimus robot, which looks sleek but doesn’t follow orders flawlessly.

(4) Audacious goals. Nvidia was the first company to cross the $4 trillion valuation mark in July of this year. And now Tesla’s board would like Musk to boost the valuation of the company beyond $8 trillion. Musk’s share repurchases have inched the company toward that lofty goal. Tesla’s market capitalisation currently stands at c.$1.2 trillion.

(5) Tesla has failed to grow its earnings in recent years. Its forward revenues have plateaued since 2023, and its forward profit margin has shrunk from a high of 16.9% in October 2022 to 7.1% recently. As a result, forward operating earnings per share has been more than halved to $2.07 and analysts expect the company will earn $1.49 this year and $2.28 in 2026.

Therefore, while Musk’s potential bumper share award made headlines, its delivery is far from certain.  However, it is a brave man who bets against Elon!

Justin Oliver

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