§4. Market Principle A (Two Equations)

Market Principle A, which requires that the market be cleared, or that loans and borrowings be equal, is formulated by the following two equations:

x1' + x2' + x3' = 0,
x1'' + x2'' + x3'' = 0.

That is, the total of this year's borrowings is zero (lendings being regarded as negative borrowings), and the total of next year's repayments is likewise zero (payments from a person being regarded as negative payments to him).