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Happy Friday to you all,

You’ve made it to the end of another week and are still (just about) sober enough to read our newsletter.

Congratulations!

Without any more dilly dallying, let’s get you your weekly roundup of the business and politics news you need to know from the UK and beyond.

⏰ Today's reading time is 5 minutes

Quote of the Week

The UK will raise defence spending to 3.5% of GDP by 2035, under pressure from NATO’s new Hague investment plan and US strategic expectations i.e Americans not wanting to foot the bill for European security whilst they’re all off down the pub or having aperitivos.

Despite internal political hesitation, particularly around balancing defence spending with domestic welfare priorities, government sources confirm the target is basically inevitable.

The broader package may push total defence-related expenditure (including intelligence and infrastructure) to 5% of GDP, a figure endorsed by NATO Secretary General Mark Rutte and implicitly supported by Donald Trump.

The UK currently spends 2.3% of GDP on defence, yet wants to maintain its leadership status within the alliance—something officials say would be very difficult without adopting the new target.

Even historically reluctant spenders like Germany and Canada are now moving toward higher allocations. When even the 2x world war starters and the Canadians are spending big on defence, you know times are really changing.

Given Britain has invaded or had a military presence in 90% of the worlds countries, we could be in for a treat in the next few years…

Anyone got stock in BAE?

Pride month has already seen it’s first high-profile breakup, with a big rift emerging between the once thriving same-sex couple Elon Musk and President Donald Trump.

What began as a policy dispute between Elon Musk and President Donald Trump has exploded into a deeply personal and public feud, reaching a dramatic peak when Musk accused Trump of being named in the unreleased Epstein files.

The post on X disrupted behind-the-scenes attempts by allies to broker peace and was widely viewed as a point of no return in the deteriorating relationship between the two influential figures.

We would have drawn the line at being high as fuck during meetings, but fair enough.

The rift comes days after Musk stepped down from his temporary role in the Trump administration, criticising the president’s “One Big Beautiful Bill” (that’s its actual name) as fiscally reckless. The fact it phased out crucial EV credits for Tesla had nothing to do with it…

Being the fastidious queen that he is, Trump hinted at revoking Musk’s government contracts entirely, prompting Musk to call for Trump's impeachment and threaten to decommission SpaceX's Dragon spacecraft (though he later walked that threat back).

The real question is: who is going to get custody of J.D Vance?

UK temporarily spared from Trump's 50% steel tariffs

The UK has been temporarily exempted from Donald Trump’s executive order doubling steel and aluminium tariffs from 25% to 50%, but the reprieve may be short-lived.

The exemption hinges on the ratification of the UK–US Economic Prosperity Deal (EPD), signed last month.

If the deal fails to materialise by July 9th, the UK could face the full tariff hike, placing significant strain on its £400 million steel export industry.

The UKs largest steel manufacturer British Steel was recently rescued from the brink by a government bail-out, so it’s not exactly in the strongest of positions in the midst of the Orange Maniacs tariff talk.

UK manufacturers welcome the temporary relief but caution that the confusion is harming business confidence and long-term planning.

The British Steel industry will have to bank on some TACO come July.

British AI Startup revealed to be 700 Indian employees pretending to be chatbots

Builder.ai, a British Microsoft-backed startup that “built” apps using AI, has filed for bankruptcy in the UK, US and India after revelations that its core offering was using a different type of AI: Advanced Indians.

While customers believed they were interacting with an AI assistant named Natasha, the company had actually hired 700 engineers in India to pose as the chatbot and manually build the apps.

The practice exemplifies a growing problem in the tech industry known as “AI-washing”exaggerating and/or bullshitting about the role of artificial intelligence in products to boost hype and get investor interest.

Given the majority of VCs haven’t got a fucking clue how the AI works, you’d be surprised at how effective this is.

Despite marketing itself as an AI disruptor, Builder.ai generated only $50 million in revenue, far below its claimed $220 million, leading lenders to seize $37 million in assets.

The company also owes Amazon and Microsoft over $100 million for unpaid cloud services. Former employees have filed lawsuits and accusations of fraud have are circulating widely.

While tech leaders continue to trumpet AI’s potential, consumer trust is eroding. A Pew survey found 43% of Americans believe AI will harm them and most still prefer human interaction over AI.

EU gives Bulgaria green light to adopt euro from the start of 2026

Bulgaria is set to become the 21st member of the euro zone on January 1, 2026, after receiving formal approval from both the European Commission and the World Economic Forum retirement village European Central Bank.

The decision follows a detailed convergence assessment confirming that Bulgaria meets all economic criteria, including inflation, budget deficit, public debt, number of chain smoking children, long-term interest rates and currency stability—thanks in part to its long-standing currency peg to the euro.

This marks a major milestone for Bulgaria, which has aimed to join the euro since entering the EU in 2007.

However, public enthusiasm has waned, with 50% of Bulgarians now skeptical of the move, largely over concerns that the currency switch will drive up prices in what is already the EUs poorest member state.

EU officials, citing data from previous euro adoptions, say such fears are often overstated and manageable with transparency and regulation. “Just don’t do a Greece” advised one official.

Joining the euro not only brings Bulgaria into the currency bloc used by 347 million Europeans but also grants it a seat on the ECB’s rate-setting Governing Council.

The move leaves just six EU countries—Sweden, Poland, Czech Republic, Hungary, Romania and Denmark—outside the euro area, none of which are poised to join anytime soon.

The United Nations faces deepening cash problem, urges members to pay up

The United Nations is facing an unprecedented financial crisis, prompting $600 million in emergency budget cuts—17% of its core operating budget.

Secretary-General António Guterres has imposed a hiring freeze and cost-saving measures, including potential staff relocations from New York to Nairobi.

Even these drastic steps may not prevent a funding shortfall of $1.1 billion by year-end, risking unpaid salaries and halted peacekeeping operations.

Some “humanitarian” organisations are already taking advantage of the instability.

The root of the crisis lies countries either not paying their membership fees or paying them too late.

Although some agencies like UNICEF get a significant % of revenue from donations (those people that accost you in blue bibs on the street), the majority of UN revenue comes from membership fees.

Just 49 countries paid their 2024 dues on time. Key contributors like the US and China have been especially problematic. China paid only four days before year-end, limiting the UN's ability to use the funds, while the US—traditionally the largest donor—is now the subject of a leaked memo suggesting it may halt payments altogether.

The UN’s rigid budget rules mean unspent late funds must be rebated to members, even those who didn’t pay.

With rebates set to soar to $600 million in 2027, the UN is trapped in a financial spiral that could upend global diplomacy, peacekeeping and human rights enforcement just when they’re needed most.

🍻Half Pints

Quick-fire news you might have missed

Memes of the Week

Activist of the Week

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