In the medium to long term, gold prices are expected to continue rising.

The main reasons include the anticipated policy of interest rate cuts in
the United States between 2024 and 2025 to address ongoing inflation and
fiscal pressure. Additionally, global central banks are consistently
increasing their gold reserves, providing solid support for gold prices.
Furthermore, international instability, such as the Russia-Ukraine
conflict, also contributes to the long-term upward trend of gold prices,
with current price drops being only short-term adjustments.

As of the end of March, China's broad money supply (M2) balance has
exceeded 300 trillion yuan, reaching 304 trillion yuan. Converted to USD,
this is approximately $42.1 trillion, setting a new historical record.

In comparison, the US M2 stands at $20.8 trillion, while the EU's M2 is

$16.5 trillion. The combined total of these two still falls short of
China's M2 balance. This means that China's money issuance volume has
surpassed the combined totals of the US and the EU! In other words, China
accounts for nearly half of the world's money issuance, with the printing
presses running at full speed!

Theoretically, an increase in broad money reflects the expansion of the

economy. When businesses obtain loans, these funds translate into
employee income and other businesses' deposits through business
activities, thus driving M2 growth.

Meanwhile, with the massive issuance of money, Chinese household deposits

have also reached a historical high, totaling 140 trillion yuan. This has
further fueled the growth of M2.

Generally, the increase in M2 involves not only deposits but also the
process of credit issuance and credit expansion. Despite the massive
scale of China's M2, which even surpasses the combined totals of the US
and the EU, there has been no significant inflation. This is indeed a
noteworthy phenomenon.

According to economic principles, an increase in the total amount of

broad money in the market typically leads to currency depreciation.
However, in reality, China's Consumer Price Index (CPI) and Producer
Price Index (PPI) growth rates are not high. On the contrary, commodity
prices continue to fall, with even the risk of deflation present,
contradicting our common sense.

M2 represents the total amount of money in society and is an indicator of

whether monetary policy is overly loose. However, the breakthrough of 300
trillion yuan in China's M2 suggests an exceptionally large scale of
money issuance. Why is this so?

In China's commercial history, the first 100 trillion yuan increase in M2

took 57 years, while the second 100 trillion yuan took only about 7
years. However, the increase from 200 trillion yuan to 300 trillion yuan
took just 4 years and 3 months.
This can no longer be described as merely "flooding"; it can be almost
likened to an economic "flood," but strangely, this "flood" has not
brought the expected impact. The logic behind this is worth exploring.

In the past, we often said that the US dollar dominated globally, but
this may not actually be the case. Currently, the US M2 is only $20.8
trillion, equivalent to about 150 trillion yuan, while China’s is double
that amount.

Further comparisons show that while China's M2 is twice that of the US,
its per capita GDP is only one-seventh of the US. Similar situations
exist in Japan, where the M2 is only $8.3 trillion, equivalent to one-
eighteenth of China's, yet its per capita GDP is about three times that
of China.

Of course, the total amount of broad money does not directly represent
actual wealth, as money itself is merely a representation of an economy's
credit. However, the amount of broad money is closely related to people's
actual living standards, and China's M2 growth in recent years has been
quite rapid.

The fundamental reason lies in the immense pressure on macroeconomic

growth. Unlike developed economies in the US and Europe, which rely on
the tertiary sector for economic growth, China's consumption as a
proportion of GDP is relatively low and more dependent on investment to
drive economic growth.

Especially after the COVID-19 pandemic, weak consumer demand has forced
the government to adopt flooding measures, though flooding itself also
aligns with the economic principle of diminishing marginal returns. Data
shows that China's second 100 trillion yuan increase in M2 took 7 years,
yet during these 7 years, macroeconomic growth remained strong.

From 200 trillion yuan to 300 trillion yuan, it took only 4 years, but
the average growth rate during these 4 years was only about 5%. Moreover,
the speed of M2 issuance is not commensurate with the GDP growth rate.

In the past, China's M2 issuance speed consistently maintained double-

digit growth, far exceeding the nominal GDP growth rate. So where did all
this money go? Part of the reason is that excess money has been converted
into resident and corporate savings. High savings rates mean that funds
remain in banks and cannot flow into effective capital, significantly
diminishing the effectiveness of economic stimulus policies.

Another part of the reason is that leverage and credit have gradually
evolved into debt. This issue is extremely dangerous in the long term
because money essentially represents the credit of an economy.

When the credit creation and capital investment return rates are high in
economic life, it promotes the tendency for deposits to become term and
long-term, leading to the growth of trust deposits and thus driving M2
growth. Conversely, M1 growth increases, and since October 2015, China's
M1 growth has consistently exceeded M2 growth.
This indicates a continuous decline in the economy's ability to generate
credit, with cash and demand deposits increasing. If combined with a
declining real estate market, this issue will become even more serious.
China's M2 growth rate is 8.3%, while the M1 growth rate has dropped to
1.1%.

What does this mean? A prolonged state of M1 growth being lower than M2
growth suggests a failure in economic credit creation, increasing
systemic economic risks, which is also the concept of a liquidity trap.

M1 represents funds that can be used immediately by businesses or

residents, in the form of demand deposits or cash. China's M1 balance is
only 68.58 trillion yuan, compared to an M2 of 300 trillion yuan, meaning
M1 only accounts for 68.58 trillion yuan, indicating a high risk of a
liquidity trap in the entire economy.

Chinese household deposits exceed 140 trillion yuan, but M1 is less than
70 trillion yuan, indicating that most funds exist in the form of term
deposits rather than demand cash.

In the first quarter of this year, Chinese household deposits increased

by 8.56 trillion yuan, while corresponding loans increased by only 1.33
trillion yuan, with a gap of 7.23 trillion yuan between deposits and
loans, indicating that funds are merely being deposited without moving.

This means that even with the continuous growth of M2, its marginal
utility in stimulating the real world will gradually diminish. If this
trend continues, it will pose significant risks to the health and long-
term development of the monetary system.

This issue deserves deep reflection. The current economic problems seem
to stem from industrial stagnation and weak consumption caused by the
COVID-19 pandemic, but fundamentally, it is an issue where industry
cannot support finance and real estate, finance and real estate cannot
support fiscal policy, fiscal policy cannot support debt, and debt cannot
support money.

In other words, upon closer examination, this problem is filled with a

lot of water. More specifically, tradable goods, i.e., industry, can no
longer support non-tradable goods like finance and real estate.

The reason is that the productivity of China's industrial capital cannot

be improved. Why can't productivity improve? The marginal return rate and
the marginal productivity of capital are declining significantly, coupled
with the relatively high prices of non-tradable goods. The excessive
rents extracted by finance and real estate from the economy have drained
the industry, creating a severe mismatch between monetary value and
domestic asset prices.

Simply put, it's like having house prices at 10,000 yuan per square
meter, while monthly wages are only 3,000 yuan. Real estate has carried
too much monetary value, and there is a huge gap between this and
people's income, indicating an enormous bubble.
This also involves the issue of leverage, specifically the ratio of M2 to
GDP.

Currently, China's M2 stands at 300 trillion yuan, while last year's GDP
was only 126 trillion yuan, leading to a leverage ratio close to 250%.

Globally, there are not many countries with such a high leverage ratio as
China. Another important indicator is the ratio of non-financial
liabilities to GDP, which also exceeded 300 trillion yuan last year,
indicating a ratio of over 200%.

What does a high leverage ratio mean?

It can be likened to a personal scenario. An entrepreneur borrows 1

million yuan to buy assets and hire employees. Theoretically, he hopes to
repay this 1 million yuan within three years and start making a profit in
the fourth year. However, in reality, despite increasing revenue, the
leverage remains high, eventually leading to a slowdown in revenue growth
but with no reduction in leverage.

For a company, this is extremely dangerous for an economy.

Low returns on various investments, diminishing marginal utility of M2

flooding, and long-term growth slowing down might even lead to the
outflow of high-net-worth individuals' assets. We often say that wealthy
groups like to emigrate, fundamentally because of the difficulties in
wealth appreciation and preservation.

China's M2 exceeds that of the US and the EU, making it challenging to

have a constant standard for the real value of money. Furthermore, the
interest rate issue is also serious.

In recent years, there has been a significant inversion between the

dollar interest rate and China's deposit interest rate, leading to
currency depreciation. To address this issue, a fundamental change in the
path dependence of the past is required.

In the past, China relied on M2 to regulate the market and stimulate

economic growth without needing to change income distribution. However,
with the diminishing marginal utility of various factors, the role of M2
will become increasingly limited, and the monetary credit system will
face tremendous pressure.

With the leverage ratio unchanged, how will debts be repaid? Various
local debts and implicit debts amount to trillions.

Currently, all sectors find it challenging to support each other,

ultimately because Chinese people's incomes cannot support it. To change
this situation, a fundamental shift in the past path dependence is
needed, fundamentally addressing the distribution mechanism problem, so
that income can feed back into both tradable and non-tradable goods
sectors.

It sounds simple, but it is extremely difficult to implement.

In the stage of economic growth, it's like sailing against the current;
if you don't advance, you retreat.

When traditional economic growth models, inflation, and monetary policy

frameworks start to fail, debt begins to balloon, and investment returns
can't even offset debt interest.

The use of leverage is also highly tempting; breaking free from it is

extraordinarily difficult. In the past, financing costs were high,
requiring 10% interest for financing, but it was entirely possible to
find assets yielding 15% for financing. Today, it is common to support 3%
asset returns with financing costs above 4%, as long as GDP continues to
grow, returns seem less important.

Over time, money will lose its essence.

Nowadays, China's financial market resembles a congested traffic

intersection, with the central bank on one side and arbitrage
institutions and traders crowded together on the other, believing they
are invincible.

As a result, these arbitrage institutions never retreat, firmly believing

in the power of loose monetary policy. China's trading winners no longer
bet on market confidence but on whose liabilities can endure more.

If you firmly believe in one thing, eventually, you will convince

yourself. The Evergrande Group is an excellent example.

In this top-down monetary distribution process, everyone increasingly

needs to understand who is arbitraging and who is strictly adhering to
market principles.

When arbitragers become more numerous, those at the bottom hoping for
flooding may ultimately receive only a drop of dew instead of the entire
ocean.

Money is never wealth; strictly speaking, it is just paper, and its true
value lies in the credit it represents.

In the intelligent era, the anchor of wealth is computing power;

mastering computing power means mastering future wealth! Digital
currencies will anchor to energy and computing power.

Washington has seen evidence of attempts by Beijing to “influence and

arguably interfere” in this year’s US elections, the secretary of state
has said during a trip to China, also warning that Chinese companies face
new sanctions if they do not stop supplying material and equipment to the
Russian arms industry.

Antony Blinken told CNN that he had reiterated Joe Biden’s message to Xi
Jinping not to interfere in November’s vote – a warning that reportedly
received assurances from the Chinese president that he would not do so.
Asked whether China was keeping to its promise, Blinken said: “We have
seen, generally speaking, evidence of attempts to influence, and arguably
interfere, and we want to make sure that that’s cut off as quickly as
possible.

“Any interference by China in our election is something that we’re

looking very carefully at and is totally unacceptable to us.”

There was no immediate response from Beijing on either the accusation of

attempts at election interference, nor the warning on sanctions, which
Blinken said the US and its allies could impose over China’s support of
the Russian defence industry. But earlier on Friday China’s foreign
minister, Wang Yi, said “disruptions” could reverse recent improvements
in US-China relations and lead to a “downward spiral” of rivalry,
confrontation and even conflict.

Speaking to reporters at the end of a three-day visit to China, Blinken

acknowledged there had been improvements in relations since a summit in
San Francisco in November between Xi and Biden.

He pointed to cooperation on counter-narcotics, the revival of contacts

between the militaries of both countries, and he announced the first US-
China talks on the security risks of artificial intelligence development,
which he said would take place in the coming weeks.

However, Blinken made clear that Chinese support of the Russian defence
industry, used to fuel Vladimir Putin’s war of aggression against
Ukraine, remained a major focus of disagreement, on which the US and its
European allies were prepared to act.

“China is the top supplier of machine tools, micro electronics,

nitrocellulose, which is critical to making munitions, and rocket
propellants, and other dual-use items that Moscow is using to ramp up its
defence industrial base,” Blinken said. “Russia would struggle to sustain
its assault on Ukraine without China’s support.”

He said Washington’s Nato allies and G7 partners saw the issue in the
same light. “Fuelling Russia’s defence industrial base not only threatens
Ukrainian security, it threatens European security. Beijing cannot
achieve better relations with Europe while supporting the greatest threat
to European security since the end of the cold war.”

He added: “I made clear that if China does not address this problem, we
will. We’ve already imposed sanctions on more than 100 Chinese entities,
export controls, et cetera. As before, we are prepared to act to take
additional measures, and I made that very clear in my meetings today.”

Blinken said China had previously shown it could take “positive action”
at a critical moment in Russia’s war in Ukraine.

“You’ll recall that well over a year ago we had concerns that Russia was
considering possibly using a nuclear weapon,” he said. “I believe that
China’s voice was important, at least at that time, in moving Russia away
from that possible course of action.”
Xi, in his own remarks at the start of his meeting with Blinken, did not
directly address Chinese policy on Russia and Ukraine. The Chinese
president said he hoped the US could look at China’s development in a
positive light.

“This is a fundamental issue that must be addressed, just like the first
button of a shirt that must be put right, in order for the China-US
relationship to truly stabilise, improve and move forward,” he said.

Earlier in the day, Wang had warned the US not to “step on China’s red
lines” when it came to its sovereignty and development.

Setting a stern tone at the beginning of a day of meetings, Wang

suggested the bilateral relationship was at a turning point. Since the
Biden-Xi summit in San Francisco in November, he said, it was “beginning
to stabilise”, with increased dialogue and cooperation.

Through an official interpreter, Wang said: “This is welcomed by our two

peoples and the international community … But at the same time, the
negative factors in the relationship are still increasing and building
and the relationship is facing all kinds of disruptions.

“China’s legitimate development rights have been unreasonably suppressed

and our core interests are facing challenges,” he said, and then he posed
a question: “Should China and the United States keep to the right
direction of moving forward with stability or return to a downward
spiral?

“This is a major question before our two countries, which tests our
sincerity and ability,” Wang added, warning the US “not to step on
China’s red lines on China’s sovereignty, security and development
interests”.

He asked: “Should our two sides lead international cooperation on global

issues and achieve win-win for all, or engage in rivalry and
confrontation or even slide into conflict, which would be a lose-lose for
all? The international community is waiting for our answer.”

Blinken emphasised the importance of managing responsibly what he called

the “most consequential” relation for both countries, to reduce the
chance of miscalculation in a volatile region.

“That really is a shared responsibility that we have, not only for our
own people but for people around the world, given the impact that the
relationship between our countries has around the world,” Blinken said.
“It’s important to demonstrate that we’re managing responsibly the most
consequential relationship for both of us in the world.”

But he insisted the US would stand up for its interests. He said he had
been “extremely clear” in his meeting with Xi about Washington’s concerns
over Chinese supplies to the Russian arms industry, and added: “We’ll
have to see what actions follow from that.”
As well as the threat of sanctions over Chinese supplies to the Russian
defence industry, Washington is considering tariffs in response to what
Blinken described as subsidised Chinese manufacturing exports flooding
the world market at the expense of US workers.

The Biden administration has also tightened export controls on computer

chips critical to AI development. And in a move that has particularly
angered Beijing, Washington plans to provide billions of dollars in aid
for the Indo-Pacific that would largely benefit Taiwan.

While Blinken was on his way to China, Congress passed legislation that
would ban TikTok in the US within a year if its Chinese parent company,
ByteDance, does not sell its stake. Blinken said the subject did not come
up in his meeting with Xi on Friday.

US officials say there has been relative calm in the Taiwan strait since
the Biden-Xi summit, following a period of high tension in which Chinese
warships and planes would regularly approach Taiwan. At the same time,
however, there has been increasing friction in the South China Sea
between China – which claims sovereignty over most of the sea – and
neighbouring countries, particularly the Philippines, a US ally.

One of the key topics in the Beijing talks was counter-narcotics

cooperation. After November’s summit, China took some steps to curb the
supply of chemical precursors and equipment used by traffickers to make
the synthetic opioid fentanyl, the leading cause of death for Americans
aged 18 to 45. However, there is concern in Washington that the steps
taken by Beijing have been token and have yet to have much effect.

Blinken, who was accompanied in Beijing by Todd Robinson, the assistant

secretary of state for international narcotics and law enforcement
affairs, held a brief meeting with China’s public security minister, Wang
Xiaohong, focused on counter-narcotics.

Blinken told the minister: “Our ability to cooperate in this area, to

show results, will have a very positive impact on relations between our
two countries.”

He said China was “providing information to international law enforcement

that can be used to track and intercept illicit drugs and their
precursors”, and that the two governments were cooperating to close
loopholes in their financial systems that drug traffickers had been using
to launder money.

Blinken said there was more to be done, however, calling on Beijing to

prosecute those selling chemicals and equipment to traffickers, and to
regulate all of the chemical precursors used in the manufacture of
fentanyl.

China Cannot Have It Both Ways

On the 25th, NATO Secretary General Jens Stoltenberg also called on China
in Berlin to stop supporting Russia's invasion of Ukraine.
"China says it wants to maintain good relations with the West, yet it
continues to fuel the largest armed conflict in Europe since World War
II. They cannot have it both ways," Reuters analyzed, noting that
Stoltenberg's stern warning to Beijing was rare.

Stoltenberg pointed out that last year, 90% of the microelectronics

imported by Russia came from China, which Russia used to manufacture
missiles, tanks, and aircraft. Additionally, China is helping Russia
acquire better satellite capabilities and imaging technology.

U.S. Treasury Secretary Janet Yellen, in an exclusive interview with

Reuters on the 25th, stated that while there are no immediate plans to
sanction Chinese banks involved in financial dealings with Russia, the
U.S. is prepared to take action if necessary.

Yellen said, "We have had extensive discussions with the Chinese side,
and I believe they understand our position. Sanctioning Chinese banks is
a tool we can use if needed."

China has repeatedly denied providing military aid or weapons to Russia.

In response to Sino-Russian trade relations, Chinese Foreign Ministry
spokesperson Wang Wenbin described it as "normal state relations" and
said other countries should not "slander" them.

Since the outbreak of the Russia-Ukraine war, trade between China and
Russia has continued to strengthen. According to Chinese customs data,
last year, Sino-Russian trade reached a record high of over $240 billion,
a 26.3% increase from the previous year. China's exports to Russia
increased by 46.9% last year, while imports from Russia rose by 13%.

Despite extensive Western sanctions, Russia has continued its attacks on

Ukraine. European and American officials criticize China's role in
enabling this, questioning whether China's exports of machine tools,
microelectronics, and other non-lethal dual-use technologies have allowed
Russia to continue producing weapons.

Summary:

This article serves as a study note, primarily introducing the concepts

of commodities and currency, discussing their essence and relationships.
It uses the example of the U.S. dollar and gold to illustrate the
development and changes of currency and the relationship between the U.S.
dollar and gold, predicting the inevitable collapse of the dollar and the
changes in gold when this happens.

Today, the U.S. is printing money extensively, leading to soaring

international commodity prices, and domestic prices of essential goods
are also rising, making the once ubiquitous $1 fried chicken a thing of
the past. Yet, amidst all this inflation, two things remain relatively
stable in price: gold and silver. This intriguing phenomenon will be
analyzed from the perspective of commodities and currency, examining the
reasonable logic in an otherwise unreasonable situation and the potential
consequences of this trend.
Gold and silver prices are highly correlated, so this discussion will
focus on the more typical example of gold. First, we must clarify what
gold is, what it represents, and why it can serve as currency. To answer
these questions, we must start with the simplest and most basic unit of
capitalist operation: the commodity.

A commodity is an item that can satisfy certain human needs: clothes for
wearing, food for eating, virtual game items for entertainment. Because
these items satisfy specific needs, they have the potential to become
commodities, known as use value. In other words, an item must have use
value to become a commodity. Another characteristic is that its use value
must enter the realm of consumption through exchange. For example, if a
farmer produces 300 pounds of grain and consumes it all himself, despite
its use value, it is not a commodity. However, if he produces 2000
pounds, consumes 1000 pounds, and sells the remaining 1000 pounds, then
the sold grain is a commodity.

Because the use value of commodities is meant for exchange, producers

often focus more on exchange value—how much they can trade or sell it
for. For capitalists, as long as the commodity can be sold and profit
made, they will reduce the quality to maximize profits, even producing
harmful goods like drugs. Even if they ensure quality, it is to sell
better and make more profit.

Let's disregard "money" and consider early human society when

productivity was low, and commodities just emerged. The exchange value of
a commodity might be expressed in other commodities, such as rice or
axes. For instance, a piece of clothing might be worth ten pounds of
rice. The question then arises: why ten pounds of rice and not something
else? Some economists argue it’s because the use value is comparable, but
this idea falters because only homogeneous things can be compared. The
true commonality between a piece of clothing and ten pounds of rice is
the human labor embodied in them.

As society develops, human productivity increases, and the range of needs

and commodities expands. With frequent exchanges, a universally accepted
item representing a stable and high amount of necessary labor time is
needed. This is how certain items, like gold, which embody high and
stable necessary labor time and are widely recognized, become money.

Initially, various forms of currency existed, like shells, which once

served as good money due to the labor involved in acquiring them. As
times changed, precious metals like gold emerged as money due to their
stable and high labor time, ease of division, and portability. Gold also
fits the roles of value measure, medium of exchange, store of value,
means of payment, and world currency.

Over time, governments started minting coins with gold, adding other
materials to represent a certain value. Eventually, paper money emerged,
representing gold. The Bretton Woods system, where the U.S. dollar was
pegged to gold, is a notable example. However, with time, the system
collapsed, and the dollar remained dominant, backed by oil.
Today, despite extensive money printing and rising prices of essentials,
gold prices remain stable. This is partly due to efforts to maintain the
dollar's dominance by suppressing gold. True currency, embodying all five
functions, remains gold.

Can the U.S. maintain this dominance with the dollar?

Ultimately, when people recognize gold as the true currency, the era of
dollar dominance will end, possibly leading to a dramatic rise in gold
prices. The future might witness a significant shift as people re-embrace
gold's true value.

Storm is on the horizon

The next major section will update the content on the commodity fetishism
or the theory of surplus value, possibly linking it to examples from
internet companies for specific analysis. Alternatively, based on
feedback, it may elaborate on the development and collapse of the Bretton
Woods system, explaining why the dollar and gold are both interdependent
and mutually exclusive.

Notes:

The concept of General Necessary Labor Time is proposed by the author and
does not exist in mainstream political economics textbooks. It serves as
a measure of social necessary labor time, indicating the average labor
time required by the majority of people in society to produce a certain
commodity.

For example, a farmer's eight-hour workday creates value equivalent to

ten hours of General Necessary Labor Time; a scientist's eight-hour
workday creates value equivalent to 160 hours of General Necessary Labor
Time.

Recently, the case of Viya's tax evasion has highlighted how much money
live-streaming e-commerce hosts can make. Many argue they do not create
value but merely profit from channels. This raises the question of who
generates the wealth these hosts earn and why they can claim it. The
article will analyze Viya and similar hosts, along with the e-commerce
platforms they rely on, using political economy principles and the
concepts of capital circulation and turnover.

Capital is not a static entity; it is constantly moving and self-

replicating within society. It operates both within the production
process and the circulation process, leading to exploitation for some
(proletariat) and wealth accumulation for others (capitalists, including
people like Viya). To understand where Viya's earnings originate and who
is being exploited, we must first analyze how capital moves—its
circulation and turnover.

Industrial capital circulation can be divided into three main stages:

The transformation of monetary capital into productive capital.

The transformation of productive capital into commodity capital.
The transformation of commodity capital into monetary capital.
Stage 1: Transformation of monetary capital into productive capital

In this stage, money acts as capital, executing its role as a means of

payment to transform into productive capital, which is divided into
constant capital and variable capital. Money becomes constant capital
through leasing or purchasing and variable capital through hiring labor.
The ability of money to serve as capital is not due to its purchasing
power but because of specific social relations; in other words, monetary
capital can only transform into productive capital when there are markets
for land, machinery, and labor.

Stage 2: Transformation of productive capital into commodity capital

In this stage, money, now as capital, purchases both constant and

variable capital (e.g., factories, raw materials, labor). It is the only
stage where surplus value is directly exploited, as illustrated by the
red section in the figure, showing surplus value created by labor.

Stage 3: Transformation of commodity capital into monetary capital

This stage involves selling the produced commodities, thus transforming

the commodity capital back into monetary capital and realizing capital
appreciation.

Industrial capital circulation involves closely interconnected stages.

Any obstacle in the first stage results in money becoming stored rather
than functioning as capital. If there is an obstacle in the second stage,
production materials and labor remain unused. Obstacles in the third
stage lead to unsold goods piling up in warehouses.

In this context, it is clear that live-streaming e-commerce hosts like

Viya are outside the traditional cycle of industrial capital. They do not
organize production or transform monetary capital into productive
capital. Instead, they employ a few service workers but do not engage
directly in production, meaning their money is not capital. Without
production capital, there is no commodity capital or subsequent
conversion into monetary capital, and thus no complete cycle of capital
appreciation.

Viya and similar hosts earn money indirectly by accelerating the

circulation time of capital, thereby increasing the capital appreciation
per unit time. However, this does not increase the commodity value
itself; they are compensated from the surplus value or products already
created in the production sector.

For instance, if a capitalist has $5000, completing one cycle of

production and sale, earning $1000 (increasing to $6000 in total). If the
cycle takes a month, this is $1000/month. By collaborating with Viya, she
reduces the sale time, completing the cycle in 10 days. This results in a
monthly appreciation of $3000 (three cycles). Even if the capitalist
shares half with Viya, earning $1500/month, it is still more than the
original. Both the capitalist and Viya seem to benefit, but at whose
expense? Likely the more exploited industrial workers.
Even if workers earn a bit more through overtime, the existence of this
system means both the capitalist and Viya win, while workers lose a
larger share. Initially producing 10 items a day for $100/month, they may
now produce 20 items a day for $120/month.

Would workers earn more if Viya took less? Unlikely, as wages depend on
the cost to hire labor, not on how much surplus value workers can create.
Even if Viya takes nothing, workers wouldn’t necessarily earn more. The
real winner would be the capitalist. Essentially, while Viya takes the
surplus value of workers, she indirectly takes what the capitalist would
otherwise take. As Viya grows, forcing capitalists to share a majority of
the surplus value with her, she stands against most capitalists, leading
to her downfall.

If the government collects less tax due to Viya's share, and she evades
taxes, finding a replacement that performs Viya’s role but takes less
surplus value while paying taxes becomes a consensus among capitalists
and authorities.

Is Viya irreplaceable? In this model, no one is irreplaceable. Without

Viya, more live-streaming platforms will emerge. Though they might not
reduce circulation time as much as Viya, their bargaining power is lower,
and they are less likely to evade taxes.

For example, a small platform reducing circulation time to 15 days/month

allows the capitalist to gain $2000, giving $100 to the platform, thus
earning $1900—more than the original. The government also collects more
revenue.

By understanding these dynamics, we can see why Viya was heavily fined
and replaced, as well as the broader implications for capital circulation
and surplus value exploitation.

Israel’s prime minister Benjamin Netanyahu has said Israel will enter the
city of Rafah in southern Gaza to eliminate Hamas, with or without a
ceasefire and hostage release deal. He added that the notion of ending
the war before Israel has reached its objectives is not an option.
Hamas officials have left Cairo after talks with Egyptian officials on a
new ceasefire proposal in Gaza, according to Egypt’s state-owned Al-
Qahera News satellite channel. The channel, which has close ties with
Egyptian security agencies, said a Hamas delegation will return to Cairo
with a written response to the ceasefire proposal, without saying when.
Israeli media has reported that Israel will not be sending a delegation
to Cairo for ceasefire talks until it has a reply from Hamas on the
latest proposal.
The UK’s deputy foreign secretary, Andrew Mitchell, has told lawmakers in
parliament in London that in the present circumstances, it was “not easy
to see” how an Israeli ground offensive in Rafah in the south of the Gaza
Strip could be “compliant with international humanitarian law”.
The top UN court has rejected a request by Nicaragua to order Germany to
halt military and other aid to Israel and to renew funding to the UN aid
agency in Gaza. The International Court of Justice said that legal
conditions for making such an order weren’t met. However, it did not
throw out the case entirely, as Germany had requested. The court said it
remained deeply concerned about conditions in Gaza.
More than 34,535 Palestinians have been killed and 77,704 have been
wounded during the Israeli military offensive in Gaza since 7 October,
the Hamas-led Gaza health ministry said in a statement on Tuesday. The
Gaza Civil Emergency Service has estimated that the bodies of a further
10,000 Palestinians were under the rubble of hundreds of destroyed
buildings. It said those figures had not been included in the updated
health ministry death toll, which only registers bodies that are taken to
hospitals.
An Israeli police officer has been “moderately wounded” in a stabbing
incident in near Herod’s Gate in Jerusalem’s Old City. The suspect,
believed to be a Turkish national who had entered Israel as a tourist,
was shot and killed.
Unrwa commissioner-general Philippe Lazzarini has said that Unrwa staff
who have been interrogated by Israeli security forces are being
“pressured to state that the agency is politically affiliated”.

Palestinian President Mahmoud Abbas has pleaded with the US to stop

Israel from attacking the Gaza border city of Rafah – saying he expects
an assault to begin within days on an area where more than a million
people have taken refuge.

Mr Abbas, who heads the Palestinian Authority (PA), said that the US is
the only nation capable of halting Israel’s plans for an assault on the
southern city, which would force much of the Palestinian population to
flee. At least half of Gaza’s 2.3 million residents are believed to be
sheltering in Rafah.

“We call on the United States of America to ask Israel to not carry on
the Rafah attack. America is the only country able to prevent Israel from
committing this crime,” Mr Abbas told a special meeting of the World
Economic Forum in the Saudi capital Riyadh.

Israel, which has threatened for weeks to launch an all-out assault on

the neighbourhood, saying its goal is to destroy Hamas’s remaining
battalions there, stepped up airstrikes on Rafah last week.

The UK, the US and several other nations have called on Israel not to go
into Rafah, fearing what will happen to those gathered there. Israel has
moved from north to south in its near-seven-month war on Hamas, which
runs Gaza. And many residents have been forced further south as the
Israeli military has advanced.

“What will happen in the coming few days is what Israel will do with
attacking Rafah because all the Palestinians from Gaza are gathered
there,” Mr Abbas said, adding that it would only take a “small strike” on
Rafah to force the Palestinian population to flee the Gaza Strip.

“The biggest catastrophe in the Palestinian people’s history would then

happen,” Mr Abbas said.
Antony Blinken, the US secretary of state, is due to travel to Saudi
Arabia for talks about efforts to agree a ceasefire in Gaza and getting
more humanitarian aid into the besieged strip.

It comes as a senior Qatari official urged Israel and Hamas to show “more
commitment and more seriousness” in ceasefire negotiations in interviews
with Israeli media, as pressure builds to reach a deal that would free
some Israeli hostages.

Qatar, which hosts Hamas’s headquarters in Doha, has been a key

intermediary and was instrumental, along with the US and Egypt, in
helping negotiate a brief halt to the fighting in November that led to
the release of dozens of hostages. But in a sign of frustration, Qatar
this month said that it was reassessing its mediator role.

An Israeli delegation is expected in Egypt in the coming days to discuss

the latest proposals in negotiations, and senior Hamas official Basem
Naim said in a message to the Associated Press that a delegation from the
militant group will also head to Cairo. Egypt’s state-owned al-Qahera TV
said the delegation would arrive on Monday.

The interviews with Qatar’s Foreign Ministry spokesperson Majed al-Ansari

by liberal daily Haaretz and Israeli public broadcaster Kan were
published and aired on Saturday evening. Mr Ansari expressed
disappointment with Hamas and Israel, saying each side has made decisions
based on political interests and not with civilians’ welfare in mind. He
didn’t reveal details on the talks other than to say they have
“effectively stopped”, with “both sides entrenched in their positions”.

Mr Ansari’s remarks came after an Egyptian delegation discussed with

Israeli officials a “new vision” for a prolonged ceasefire in Gaza,
according to an Egyptian official, who spoke to the Associated Press on
condition of anonymity to freely discuss developments.

The Egyptian official said that Israeli officials are open to discussing
establishing a permanent ceasefire in Gaza as part of the second phase of
a deal. Israel has refused to end the war until it defeats Hamas. The
second phase would start after the release of civilian and sick hostages,
and would include negotiating the release of soldiers, the official
added. Senior Palestinian prisoners would be released and a
reconstruction process launched.

A Russian missile attack on an educational institution in a popular

seafront park in the Ukrainian Black Sea port of Odesa, known locally as
‘Harry Potter castle’, on Monday killed at least five people and injured
32, local officials said. The previous death toll was four.

The building is reportedly the residence of prominent former MP Serhiy

Kivalov, who was among those said to have been injured in the strike.

Regional governor Oleh Kiper said that in addition to those killed in the
attack, one man died after suffering a stroke attributed to the strike.
Kiper said eight of the injured were in serious condition, including a
four-year-old child. Among the injured were another child and a pregnant
woman.

“Our doctors are trying to do their best,” he added.

Here are some of the other main developments in the war:

Nato countries have not delivered what they promised to Ukraine in time,
which has benefited Russia on the frontline, Jens Stoltenberg has said.
“Serious delays in support have meant serious consequences on the
battlefield” for Ukraine, the Nato secretary general said in Kyiv while
meeting the Ukrainian president, Volodymyr Zelenskiy. Ukrainian officials
say Russia is assembling forces for a major summer offensive, even if its
troops are making only incremental gains at the moment. “The lack of
ammunition has allowed the Russians to push forward along the frontline,”
Stoltenberg added. “Lack of air defence has made it possible for more
Russian missiles to hit their targets, and the lack of deep strike
capabilities has made it possible for the Russians to concentrate more
forces.” Zelenskiy said new western supplies have started arriving, but
slowly. “This process must be speeded up,” he said.
The head of the southern Kherson region said Russian shelling killed one
person in the last 24 hours.
Debris showed that an North Korean Hwasong-11 ballistic missile hit
Kharkiv on 2 January, UN sanctions monitors have told a security council
committee in a report seen by Reuters. The missile was most likely
illegally supplied to Russia, they conclude. North Korea is accused of
developing such weapons and supplying them to Russia despite being under
UN sanctions for its ballistic missile and nuclear programmes since 2006.
Ukraine’s allies have accused North Korea of transferring weapons to
Russia for use against Ukraine in violation of an arms embargo. The US
has accused Russia of launching North Korean-supplied ballistic missiles
against Ukraine on at least nine occasions.
Away from the frontline, Polish farmers have lifted blockades at border
crossings with Ukraine, officials said on Monday, ending a two-month
protest over farm imports and alleged unfair competition.
Sophie, the Duchess of Edinburgh, made an unannounced visit to Ukraine –
the first British royal to travel to the country since Russia’s 2022
full-scale invasion.
Buckingham Palace said on Monday that Sophie, wife of Prince Edward, met
Zelenskiy and first lady Olena Zelenska in Kyiv and delivered a message
on behalf of King Charles III. It did not disclose the timing or details
of the visit. The palace said Sophie made the trip “to demonstrate
solidarity with the women, men and children impacted by the war and in a
continuation of her work to champion survivors of conflict-related sexual
violence.”

The Tesla CEO, Elon Musk, arrived on an unannounced visit to Beijing on

Sunday where he is expected to meet senior officials to discuss the
rollout of full self-driving software and permission to transfer data
overseas, according to a person with knowledge of the matter.

Chinese state media reported that he held talks with the country’s
premier, Li Qiang, during which Li told Musk that Tesla’s development in
China could be seen as a successful example of US-China economic and
trade cooperation.

The US electric vehicle maker rolled out full self-driving, or FSD, the
most autonomous version of its Autopilot software, four years ago but has
yet to make it available in China, its second-largest market, despite
customers urging it to do so.

Musk said in response to a query on X this month that Tesla may make FSD
available to customers in China “very soon”.

Rival Chinese automakers such as Xpeng have been seeking to gain an

advantage over Tesla by rolling out similar software.

Musk hopes to obtain approval to transfer data collected in the country

abroad to train algorithms for its autonomous driving technologies, the
person said.

Since 2021 Tesla has stored all data collected by its Chinese fleet in
Shanghai and has not transferred any back to the US, as required by
Chinese regulators.

Musk’s visit coincides with the Beijing auto show, which opened last week
and ends on 4 May. Tesla does not have a booth at China’s largest car
show and last attended in 2021.

His visit to China was not flagged publicly and the person spoke on
condition of anonymity because they were not authorised to speak with
media. Tesla did not respond immediately for comment.

The Chinese state broadcaster CCTV, in its report about Musk’s meeting
with Li, did not say whether the two had discussed FSD or data.

Musk also met Ren Hongbin, a government official who heads the China
Council for the Promotion of International Trade, the organiser of the
Beijing auto show, state media reported.

“It is good to see electric vehicles making progress in China. All cars
will be electric in the future,” Musk said in a video posted on social
media by a user affiliated with state media.

Musk’s trip came just over a week after he scrapped a planned visit to
India to meet the prime minister, Narendra Modi, citing “very heavy Tesla
obligations”.

The company said this month it would lay off 10% of its global workforce
as it grapples with falling sales and an intensifying price war for EVs
led by Chinese brands.

US auto safety regulators said on Friday they had opened an investigation

into whether Tesla’s recall of more than 2m vehicles in the US announced
in December to install new Autopilot safeguards was adequate after a
series of crashes.
Tesla has sold more than 1.7m cars in China since it entered the market a
decade ago. The Shanghai factory is its largest.

Russian forces in occupied Ukraine are using Starlink terminals produced

by Elon Musk’s SpaceX for satellite internet in what is beginning to look
like a “systemic” problem, Kyiv’s main military intelligence agency has
claimed.

Starlink terminals were rushed in to help Ukraine after Russia’s February

2022 invasion and have been vital to Kyiv’s battlefield communications.
Starlink says it does not do business of any kind with Russia’s
government or military.

“Cases of the Russian occupiers’ use of the given devices have been
registered. It is beginning to take on a systemic nature,” said Ukrainian
defence intelligence (GUR) spokesperson Andriy Yusov.

The GUR said terminals were being used by units like Russia’s 83rd air
assault brigade, which is fighting near Klishchiivka and Andriivka in the
partially occupied eastern region of Donetsk.

Starlink terminals are supposed to be “geofenced” so they do not function

in unauthorised locations. There has been discussion online that, for
example, Russian forces may be able to “spoof” the geofence to make a
terminal in a blocked area appear as if it is in a permitted area. It has
also been suggested that Russian soldiers might use ill-gotten terminals
in areas of Ukraine that were cleared for Starlink to help the
Ukrainians, but have since come under Russian attack or occupation.

In a post on X on Sunday, Musk said: “To the best of our knowledge, no

Starlinks have been sold directly or indirectly to Russia … A number of
false news reports claim that SpaceX is selling Starlink terminals to
Russia. This is categorically false.”

Musk did not appear to address whether Russian soldiers might be

obtaining and using Starlink terminals regardless. In its own statement,
Starlink also did not say anything about their possible use in occupied
areas of Ukraine.

“If SpaceX obtains knowledge that a Starlink terminal is being used by a

sanctioned or unauthorised party, we investigate the claim and take
actions to deactivate the terminal if confirmed,” Starlink said.

Neither Musk nor Starlink outlined any pro-active efforts to prevent

Russian forces from obtaining terminals or connecting to Starlink; nor
did they say whether specific Ukrainian claims were being investigated.

SpaceX does not do business of any kind with the Russian Government or
its military.

Starlink is not active in Russia, meaning service will not work in that
country. SpaceX has never sold or marketed Starlink in Russia, nor has it
shipped equipment to locations in Russia. If…
— Starlink (@Starlink) February 8, 2024
Ukraine’s GUR agency said it had intercepted an exchange between two
soldiers discussing setting up the terminals. It posted what it said was
an audio clip of the exchange on the Telegram messenger by way of
evidence.

The GUR did not say how it thought the terminals had been obtained by
Russian forces – whether for instance they had been procured from abroad
or captured from Ukrainian forces.

Tesla shareholders should reject CEO Elon Musk's $56 billion pay package,
according to proxy advisory firm Glass Lewis, which singled out the
"excessive size" of the deal and its potentially negative impact on
smaller shareholders.

The recommendation from the influential proxy advisory company comes as

Tesla is asking its shareholders to vote again on his 2018 pay package
after a Delaware judge earlier this year nullified the payout, which was
the biggest compensation plan in corporate America.

Tesla shareholders are set to vote on the pay package on June 13. The
company didn't immediately respond to a request for comment about Glass
Lewis' recommendation to vote against the pay deal.

Proxy advisory firms are relied on by institutional investors to provide

research and advice on how to vote during annual and special meetings on
public companies' proxy proposals, which can range from executive
compensation to corporate governance issues. In Tesla's case, Glass Lewis
wrote in a 71-page report, shared with CBS MoneyWatch, that Tesla
shareholders risk stock dilution if Musk is granted the massive stock
grant, meaning that their shares could be worth less as a result.

The proxy advisory firm also noted that Musk is well compensated through
his current 12.9% ownership of Tesla, a stake that is valued at about $74
billion, according to the Bloomberg Billionaires Index. Musk doesn't
receive a salary from Tesla, but Glass Lewis noted that his shares in the
company mean that his interests are already aligned with that of the
business.

The value of Musk's current Tesla stake "challenges the very basis that
the 2018 grant as structured and sized was even necessary," Glass Lewis
wrote.

Dilution occurs when a company issues additional stock, which in turn

shrinks the proportional ownership stake of pre-existing shares. Under
the 2018 pay deal for Musk, Tesla would issue about 304 million new
shares, creating a dilution effect of about 9%, the firm said.

"[T]hese concerns are exacerbated by the concentration of ownership in

Mr. Musk," the report said, noting that Musk would increase his ownership
stake to 22.4% if the 2018 pay package were to be approved next month.
"Mr. Musk would be the Company's largest shareholder by a healthy
margin."
It added, "Given the impact on the holdings of other shareholders, the
continued concentration of ownership around Mr. Musk warrants particular
attention."

Neo4j native integrations with Microsoft Fabric and Microsoft Azure

OpenAI Service unify data management, improve accuracy, and reduce
hallucination in AI applications

SAN MATEO, Calif., March 26, 2024 /PRNewswire/ -- Neo4j®, a Graph

Database and Analytics leader, announced a collaboration with Microsoft
to deliver a unified data offering that addresses customers' critical
data needs for Generative AI (GenAI). Specifically, the collaboration
will see Neo4j's powerful graph capabilities natively integrated into
Microsoft Fabric and Microsoft Azure OpenAI Service to seamlessly combine
structured and unstructured data, and enable customers to uncover hidden
patterns and relationships within their data for better insights and
decision-making, all as part of a comprehensive solution.

"By 2025, graph technologies will be used in 80% of data and analytics
innovations — up from 10% in 2021 — facilitating rapid decision-making
across the enterprise," predicts Gartner® in its Emerging Tech Impact
Radar: Data and Analytics November 20, 2023 report. 1Gartner also notes,
"The ability to discover and document data use cases and help build
knowledge graphs out of data uses is becoming a vital capability. It is
the first step to resolving fragmented data management issues by enabling
a GenAI-augmented data fabric," in its January 23, 2024 report titled
Innovation Insight: How Generative AI is Transforming Data Management
Solutions.

Azure OpenAI Service enables businesses to use advanced AI models and

tools that unlock the full potential of their data. Microsoft Fabric is
an AI-powered analytics platform that enables everything from data
movement to data science, real-time analytics, and business intelligence.
Customers benefit from the integration of Neo4j's graph database within
Azure OpenAI and Microsoft Fabric in the following ways:

Transform unstructured data into knowledge graph: Developers can use

OpenAI Service to process unstructured data, structure it, and load it
into a knowledge graph. Once in a knowledge graph, users extract insights
leveraging Neo4j data visualization and query tools like Bloom or use
Neo4j connector with Power BI for business intelligence (BI).

Enhance contextual understanding and explainability with GraphRAG: With

Neo4j's GenAI functions, Azure OpenAI Service can be used for fully
integrated GraphRAG applications, whereby LLM queries can be used against
enterprise data in knowledge graphs. GraphRAG is an enhanced form of
Retrieval Augmentation Generation (RAG) whose results demonstrate
intelligence or mastery that outperforms other approaches previously
applied to private datasets. Enterprises can also use Gen AI
orchestration platforms like LangChain and LlamaIndex to build
intelligent GenAI applications.

Long-term memory for LLMs with vector embedding integration: Neo4j

provides long-term memory for large language models by supporting native
vector embeddings. Neo4j has inbuilt support for vector storage and
search capability for intelligent GenAI applications. Developers can now
natively use Azure OpenAI embedding APIs to create embeddings and store
them in the Neo4j Database.

Graph-powered insights as part of Microsoft Fabric unified data platform:

Microsoft Fabric customers can now use Neo4j Graph Database and Analytics
capabilities to discover hidden patterns and relationships deeply,
easily, and quickly. Developers can implement Azure Data Factory to
ingest data from OneLake into Neo4j, extract data from Synapse Data
Warehouse using the Neo4j data warehouse connector, run Graph Data
Science algorithms from Synapse Data Science Notebooks, and leverage
Power BI to build interactive dashboards on Neo4j Knowledge Graphs.

Graph Analytics as native Fabric workload: Neo4j and Microsoft Fabric

teams are working together to deliver Neo4j as a native workload for
Graph Analytics on Microsoft Fabric platform. This will enable users to
access graph analytics workload directly from the Microsoft Fabric
console, create Graph models from OneLake data, analyze Graph data, run
Graph Data Science Algorithms using Neo4j Bloom, and write back results
into OneLake for a seamless end-to-end integration.
Neo4j's Azure OpenAI Service integration is generally available now. The
integration of Neo4j's graph database into Microsoft Fabric will be
generally available later this year.

Neo4j also announced the general availability of Neo4j's fully managed

graph database offering AuraDB on Azure Marketplace, giving developers a
frictionless, fast-start experience on generative AI. Azure Marketplace
offers thousands of industry-leading software and services that are
certified and optimized on Azure.

For more information about Neo4j's collaboration with Microsoft, read our
blog post or visit the Neo4j booth #307 at Microsoft FabCon, March 26-28.

Supporting quotes

Srinivas Suravarapu, CEO, ScribeStar

"ScribeStar is on a mission to make capital markets cheaper and easier to
access by providing technology that helps companies list, report, and
fulfill ongoing obligations. Today's announcement underscores how our
partners, Microsoft and Neo4j, enable SaaS businesses like ScribeStar to
provide powerful solutions to discover complex relationships within our
data. The ability to build intelligence with speed and precision using
graphs is integral to developing the next generation of intelligent
solutions in capital markets. Graphs are everywhere, and so is the cloud
– a future of analytics powered by Microsoft Fabric and Neo4j is
inevitable, and this partnership makes absolute sense for ISVs like us."

Sudhir Hasbe, Chief Product Officer, Neo4j

"We're excited to combine Neo4j's unparalleled graph capabilities
alongside Microsoft's seamless scalability, advanced AI capabilities of
Azure OpenAI, and AI-Powered Analytics Platform with Microsoft Fabric.
Enterprises can now unlock deeper insights, navigate complex data
relationships, and drive better decision-making and innovation in ways
that were not possible before. Together, we're helping customers redefine
what's possible for their data in an increasingly interconnected GenAI
world."

Arun Ulag, CVP, Azure Data, Microsoft

"Microsoft is committed to empowering organizations with the tools and
technologies they need to thrive in today's data-driven world," said Arun
Ulag, CVP, Azure Data, Microsoft. "Our collaboration with Neo4j
represents a significant step forward in delivering innovative data
solutions that will enable businesses to unlock new opportunities and
drive digital transformation in the GenAI era."

1GARTNER is a registered trademark and service mark of Gartner, Inc.

and/or its affiliates in the U.S. and internationally and is used herein
with permission. All rights reserved.

About Microsoft

Microsoft (Nasdaq "MSFT" @microsoft) enables digital transformation for

the era of an intelligent cloud and an intelligent edge. Its mission is
to empower every person and every organization on the planet to achieve
more.

About Neo4j

Neo4j, the Graph Database & Analytics leader, helps organizations find
hidden relationships and patterns across billions of data connections
deeply, easily and quickly. Customers leverage the structure of their
connected data to reveal new ways of solving their most pressing business
problems, from fraud detection, customer 360, knowledge graphs, supply
chain, personalization, IoT, network management, and more – even as their
data grows. Neo4j's full graph stack delivers powerful native graph
storage with native vector search capability, data science, advanced
analytics, and visualization, with enterprise-grade security controls,
scalable architecture and ACID compliance. Neo4j's dynamic open-source
community brings together over 250,000 developers, data scientists, and
architects across hundreds of Fortune 500 companies, government agencies
and NGOs.