The cost of NATO, the Iran war and AI bubbles

The Iran conflict is being felt at the petrol pumps Keystone-SDA

Welcome to our press review of events in the United States. Every Wednesday we look at how the Swiss media have reported and reacted to three major stories in the US – in politics, finance and science.

Everything boils down to money eventually. NATO is costing a potential split from the US while motorist fume at the price of petrol and investors size up the risk-reward profile of new AI companies.

Help us improve the press review
As a reader of our weekly press review, your feedback is important to us. Please take two minutes to answer a short survey and help us improve our journalism. This survey is anonymous and all data is confidential.
👉 [Take the surveyExternal link]

NATO is preparing for life without the US Copyright 2026 The Associated Press. All Rights Reserved

The 36^th NATO summit witnessed fireworks, threats and contradiction as Donald Trump arrived in Ankara last week. “Trump subjected the entire world to a diplomatic rollercoaster,” noted the Tages Anzeiger.

Trump dished out the usual array of complaints, starting with the refusal of NATO member states to support his war with Iran – only to dish out compliments after the summit had ended.

“In a defense alliance that has existed for 77 years and is based on mutual trust, such inconsistency is difficult to endure in the long run,” the Tages Anzeiger said.

“Trump neither sees Russia as a threat to the security of the United States, nor does he consider the security of Europe to be in the US’s own best interest,” it added.

But the newspaper also noted a change in response from Europe. The continent is no longer so alarmed at the prospect of the US withdrawing funding and military support.

Instead, it is gearing up for “NATO 3.0” in which European countries ramp up their own defences to shed dependence on US military hardware.

“What is also dawning on Europeans is that, in the future, they may be able to rely more on Ukraine than on the Americans to defend themselves against Russia.”

But it might not be so easy to detach from the US nuclear deterrence or replace the command and reconnaissance capabilities the US has built up over the decades. “The years of transition could prove dangerous,” the Tages Anzeiger warns.

• NATO summit analysisExternal link – Tages Anzeiger (German, paywall)
  
• Trump attacks NATO and IranExternal link – SRF (German)

Oil and gas prices have inflated during the Middle East conflict Copyright 2019 The Associated Press. All Rights Reserved

Every passing day of conflict in the Middle East piles further misery onto the global economy. The latest escalation of hostilities over the Strait of Hormuz has raised oil prices and increased the chances of higher interest rates.

The Swiss media largely blames the US. “The jerky, almost irrational carrot-and-stick approach they are currently employing will lead nowhere,” writes former UN diplomat Paul-Henri Arni in Le Matin Dimanche.

“This is going to be a long, hot summer. Crude oil prices have risen, as it will now take even longer for oil exports from the Gulf region to normalise,” predicts the Neue Zürcher Zeitung.

“There’s no way around it: once Pandora’s box is opened, it can only be closed with a massive effort. The longer the warring parties delay, the higher the bill will be.”

For 24heures, the conflict represents “a state of permanent uncertainty for the economy. It is fueling inflationary pressures and could lead the European Central Bank to raise its rates again this year. If we enter another period of high tension, it risks weighing once more on household morale and therefore consumption.”

But having identified the symptoms (the Strait of Hormuz) and the cause of the ailment (the US), Swiss reporters are less certain about prescribing a cure before the US mid-term elections in November.

The NZZ is convinced that Trump will lay the blame on large oil companies when they announce bumper profits at the end of July. But a concrete and lasting solution may take years, according to Paul-Henri Arni in Le Matin Dimanche.

“Since the Iranians have more time on their side than President Trump, this war is unlikely to end until he leaves the White House,” he states.

• Iran conflict could drag on for yearsExternal link – Le Matin Dimanche (French)
  
• Fuel prices inflated by conflictExternal link – NZZ (German, paywall)
  
• Iran economy in ruinsExternal link – Tages Anzeiger (German, paywall)

Fears grow that the AI bubble will pop Keystone-SDA

“A massive bet is currently being placed on artificial intelligence in the financial markets,” declares Swiss public broadcaster SRF. Investors think AI is the next big thing. But “there are legitimate doubts about this”.

The Neue Zürcher Zeitung is also concerned about the mega-billions being poured by Wall Street into an unproven technology. The newspaper has flashbacks to the dotcom and housing market bubbles at the start of the Millennium.

“But this time, everything is different. And probably worse,” it said. “What price will we eventually pay for our high in the AI ​​casino? And can we even afford it?”

Both media outlets identify vast levels of debt inflating the bubble, which links the bond market, private equity and more opaque sources of funding. US tech giants are even cross-pollinating each other by investing huge fortunes in the projects of rival firms.

“If the bubble bursts, the economy could be occupied for years with reducing debt,” writes the NZZ.

Financial market panic could easily be sparked by disappointing company results or the failure of a product to launch on time, warns SRF.

“The potential for a fall is far greater today than in 2000 or 2008. This is because the American financial market is much larger and more complex now than it was then. And the wealth of many Americans is held there. And that of many foreigners, too.”

• Investors never learn from historyExternal link – NZZ (German, paywall)
  
• How a market panic could be ignitedExternal link – SRF (German)

The next edition of ‘Swiss views of US news’ will be published on Wednesday, July 22. See you then!

If you have any comments or feedback, email [e-mail]

Stay informed with our weekly newsletter!

Are you looking for a simple way to stay updated on US-related news from a Swiss perspective?

Subscribe to our free weekly newsletter and receive concise summaries of the most important political, financial, and scientific stories in the United States, as reported by Switzerland’s leading media outlets – delivered straight to your inbox.

👉Sign up by entering your email address in the form below!