The AI Economy

With new technologies, the focus is often initially on the dangers: there is a fear that Artificial Intelligence will replace thinking and destroy jobs. This reflex falsely assumes a fixed economic pie that is merely being redistributed, but economic history proves the opposite. Productivity gains enlarge the pie. Just like with the invention of the light bulb, the automobile, or the internet, old professions disappear while new ones emerge; technological progress has always increased the prosperity of the general population, not just that of a minority.AI takes over the execution, leaving humans with more capacity for the actual purpose. Nothing else lies behind the concept of productivity: the potential to achieve significantly more with the same work-force. If, for example, the efficiency of a software developer multiplies, the price of their service drops accordingly, allowing small businesses to afford technologies that were previously reserved for large corporations. The addressable market thus does not grow linearly — it explodes. High-quality AI support in daily operations frees up capacity for backlogs and innovation, noticeably improves the quality of almost every service, and fuels the rate of innovation — from scientific breakthroughs to the daily routine of our own company.

The Scale of AI Investments

The brightest minds in the technology industry are going uncompromisingly on the offensive regarding data centers. For the year 2026, the announced investments by Alphabet, Microsoft, Amazon, and Meta total around 700 billion US dollars — and even reach 750 billion when including Oracle. This exceeds the entire German federal budget, equals roughly six times the Swiss federal budget, and accounts for around two percent of the US gross domestic product.To finance this, these corporations are now tying up nearly their entire operating cash flow and issuing bonds in the triple-digit billions. What were once capital-light business models are turning into highly capital-intensive constructs. Yet a look at the order books refutes the thesis of a pure speculative bubble: Microsoft’s commercial backlog has doubled to over 600 billion US dollars, and Google Cloud's backlog rose to over 460 billion. Mean-while, the language model company Anthropic took just under four years after its founding to reach its first billion in revenue — and then increased its annualized revenue from 9 billion to a remarkable 47 billion US dollars within just a few months. Never before in economic history has a company grown so rapidly; a comparable pace was achieved only shortly before by OpenAI with ChatGPT. Established technology giants like Alphabet and Amazon required one to two decades to reach a comparable revenue scale. The demand is therefore just as real as it is impressive, even if the valuations of the players are highly heterogeneous.

Broader Diffusion

The massive flow of capital is currently primarily fueling semiconductors, industrial equipment, and the energy sector. However, in the medium term, value creation will not remain solely with the suppliers; the boom is slowly but inevitably diffusing into the wider economy. Already, the price increases are backed entirely by real earnings growth. In the first quarter of 2026, all eleven sectors of the US stock market exceeded expectations. While Europe remains primarily a bystander in AI infrastructure and is hit far harder in terms of energy economics due to the Iran conflict, selected companies still benefit from the global boom as highly specialized suppliers. Thus, even here — albeit with lower absolute figures — at least nine out of eleven sectors exceeded expectations. The price-earnings ratio has fallen on both sides of the Atlantic despite rising prices, proving a fundamental earnings momentum rather than mere herd mentality. An unmistakable euphoria is manifest only in semiconductors, which have surged by over fifty percent since the start of the war.

Macroeconomic Resilience

When gigantic AI investments collide with swelling government deficits and scarce resources, it unleashes both growth and inflation simultaneously. Rising stock prices accompanied by rising bond yields are the unmistakable signature of this reflation. This dynamic is further exacerbated by the war between the US and Iran that broke out in February 2026. With the closure of the Strait of Hormuz, the price of Brent crude oil spiked temporarily to 138 US dollars and remains well above pre-war levels today. The bond markets are reacting clearly: interest rate cuts have long been priced out; instead, hikes by the end of the year are being discussed. Yet remark-ably, the stock market did not capitulate despite war, energy shocks, and supply chain risks. When bad news no longer triggers price drops, it testifies to considerable inner strength.

Quality as a Compass

The first reflex of many investors is maximum allocation to those few corporations currently dominating the boom. However, this is where risks accumulate: valuations price in high expectations, business profiles are shifting riskily into capital-intensive territory, and the risk of disruption by novel AI models and hardware remains immense. Who will ultimately win the infrastructure race remains completely open. In its euphoria, the market chases the sprinter and declares the marathon runner dead — much like Berkshire was written off as a dinosaur at the height of the Dotcom mania. Numerous long-term quality companies can currently be found at historical discounts in sectors such as luxury goods, software, fragrances, or construction suppliers. Increased inflation and interest rates are the decisive reasons to insist on balance sheet strength, pricing power, and a solid valuation buffer. The best-positioned companies are those with a proven track record that apply AI as a lever on both sides of the profit equation: efficiency increases the margin, innovation drives revenue. Here, the privilege of the global investor reveals itself: we do not have to choose between fast-paced technology leaders and successful adopters. We invest in both worlds, always uncompromisingly aligned with an attractive risk-reward ratio. Through this combination of technological innovation and proven substance, we shape a robust portfolio that delivers compound interest across the full cycle.

Zurich, end of June 2026