FFM Fund Newsletter - Nov 2025

November 2025

Dear Friends, Dear Investors,

Last month, we noted that although the United States should not fall into a recession within the next six months, thanks in particular to the massive investments in AI, the situation could still feel like a recession for a large share of American consumers. We also pointed out that companies reliant on domestic consumption were likely to suffer as a result.

The earnings published over the past few weeks have only confirmed this view: companies such as Chipotle Mexican Grill, Cava, or Sweetgreen have seen their share prices sharply decline. The idea of a “K-shaped” economy is becoming increasingly common, an America running at two speeds, where wealthier households continue to benefit from rising asset prices (real estate and equities), while more vulnerable households feel the full force of the economic slowdown.

Adding to this, a wave of job cuts at large corporations, Amazon being the most notable example, combined with growing fears that AI may start replacing certain categories of workers, has pushed US consumer confidence to its lowest level in five years.

That being said, and because we use AI tools ourselves, we still struggle to see how this technology could, at this stage, genuinely replace employees. AI is a valuable tool, certainly useful, but far from being a fully autonomous or entirely reliable solution.

It appears to us that almost every CEO now feels compelled to announce both layoffs and major AI investments, even though the promised productivity gains may well remain largely theoretical.

This brings us back to our investment philosophy. In an environment where technology continues to fuel enthusiasm while economic signals remain mixed, we focus on strong balance sheets, high-quality business models, and companies capable of navigating cycles, rather than market trends or the still-uncertain promises of AI. Our role, now more than ever, is to stay the course: avoid excess excitement, look past short-term fears, and concentrate on companies that create sustainable, long-term value.

Best regards,

Your CaridaB Group Team