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# System prepended metadata

title: REFERENCE
tags: [reference]

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tags: reference
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# REFERENCE
#### What this page is for
Many terms in use have a range of usages and consequent implied meanings.
Since this is an analytical, rather than a discursive space, it is important that key terms used in this collection of pages are well defined.
We are not seeking to canonically define the meaning or usage of terms beyond this body of work.
Three categorisations are used:
- [Definitions](#Definitions) - terms defined rather tightly in these pages
- [Terminology](#Terminology) - terms that have a particular meaning in these pages
- [Notations](#Notations) - symbols used and the terms to which they refer

*This document will likely get long ;) - use ctrl/cmdF to search!*

## Definitions
Canonical definitions of terms.
When these terms are used in these pages, the reader should be able to rely upon them having the meaning set out.

*To add a new definition, copy and paste the following two-line template - choose position alphabetically to help readers, please. Replace the words `Definition Template` with the term name, and the default text with a very terse definition. Turn the term name into a link to a document if warranted.*
#### [Definition Template]
- terse definition only please. Make term name a link if needed.
### The Definitions
#### [Producer Credit](/DTUtLOJiQ0Ceu0wvSEBSPg)
- a credit-based means-of-exchange system where credit-money is created by entities at the point of purchase on the basis of their willingness to accept payment for their future product in units of that money.
#### [Mutual Credit](/NNBmtHAsSLCffrItxDvX0A)
- a [Producer Credit](/DTUtLOJiQ0Ceu0wvSEBSPg) system which is mutually owned and governed by its members, and which affords interest-free credit.



## Terminology
Within this body of work, certain terms are used which have a specific local meaning. 
It's important that these are clearly explained since the terms are not in general use.

*To add a new terminology entry, copy and paste the following two-line template- choose position alphabetically to help readers, please. Replace the words `Terminology Template` with the term name, and the default text with a very terse description. Turn the term name into a link to a document if warranted.*
#### [Terminology Template]
- terse description only please. Make term name a link if needed.
### The Terms
#### [Trade Credit Club](/Q93p0MdKRr-D07uK3iAVHg)
- a mutual association of businesses using a Club ledger to support [Continuous Clearing], [Periodic Settlement] and [Mutual Credit](/NNBmtHAsSLCffrItxDvX0A), using a federating protocol.

## Notations

See also [notation for trades](/2iRH2t-QRLOYL3cHkbCgTw).

* $C$ - a mutual credit club.
* $b_i$ - the [account balance](/R1iAIsZoRRmJgIV4NlHQZw) of member $M_i$.
* $i$ - integer index over a set of trade credit club members.
* $j$ - another integer index that can be used over the same set as $i$, e.g. to denote two club members $M_i$ and $M_j$ between whom a transaction occurs.
* $k$ - an integer index over $n_{j,i}$.
* $l$ - an integer index over $n_{i,j}$.
* $L_c^{\pm}$ - positive and negative clearing [account balance limits](/AYLZ5n-WTG6eiRVSlh0qOw), e.g. $L_{i_c}^+$ is member $M_i$'s positive clearing limit.
* $L_t^{\pm}$ - positive and negative trading [account balance limits](/AYLZ5n-WTG6eiRVSlh0qOw), e.g. $L_{i_t}^-$ is $M_i$'s negative clearing limit.
* $M$ - denotes a business or other entity that is a member of a mutual credit club.
* $n_{i,j}$ - the number of payments from $M_i$ to $M_j$ over a given settlement period.
* $n_{j,i}$ - the number of payments from $M_j$ to $M_i$ over a given settlement period.
* $N$ - number of club members.
* $\tilde{N}$ - number of club members that have conducted a trade within some [analysis period](/conspoQ5TNmH5pfZqp-LfQ) and are therefore considered 'active.'
* $P(E)$ - probability of some event $E$ occuring, e.g. $P(DE)$ gives the probability of default as a generic outcome from a trade credit arrangement.
* $q$ - the value of a trade in fiat.
* $q'$ - the value of a trade in mutual credit units.




### Greek

* $\beta$ - the size of a [fiat buffer](/d2m7xva0QzOZ80y2uBvBVg) held in a trade credit club's 'system' account that is available to offset late payments or defaults on fiat payments to the system account at the end of each settlement period.
* $\Delta t$ - the interval between an invoice being issued and settlement being made. See [late payment](/iIVkdpz_S76a_6FexHZWAw).
* $\mu$ - the probability that the sum of late fiat payments or defaults on transcations to the system account on settlement day will be greater than the available [fiat buffer](/d2m7xva0QzOZ80y2uBvBVg).
* $\tau$ - the specified time period in which a trade credit invoice should be settled. See [late payment](/iIVkdpz_S76a_6FexHZWAw).
* $\omega$ - a weighting factor that determines how the losses associated with [defaults](/nO2IbqcMTbiNSY0AG0PCnA) are spread amongst remaining club members.