Heat the butter in a medium saucepan over medium heat until melted. Add the garlic and shallot and cook, stirring, until soft, about 2 minutes. Add the Brussels sprouts and stir until well coated in the butter. Add the cream, cayenne, nutmeg, 1/2 cup water and 1/2 teaspoon of salt. Bring to a simmer, cover and cook until the Brussels sprouts are soft, about 15 minutes. Uncover and continue to cook until they are tender and the liquid has reduced into a creamy sauce, about 10 minutes more.
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