market clearing


Also found in: Wikipedia.

Market clearing

Total demand for loans by borrowers equals total supply of loans from lenders. The market, any market, clears at the equilibrium rate of interest or price.

Market Clearing

A situation in which the demand for loans equals the supply of loans. That is, borrowers want to borrow the same amount of money that lenders are willing to lend. During a market clearing, the equilibrium rate of interest prevails, which ideally means that the cost of borrowing is neither excessively high nor low.

market clearing

a MARKET situation where the DEMAND for a product exactly matches SUPPLY of the product, leaving neither excess demand nor excess supply. See EQUILIBRIUM MARKET PRICE.
References in periodicals archive ?
The operating costs are quite high and total costs are higher still, well above recent market clearing prices.
Bill Dubinsky, Head of ILS at WCMA, said: Money managers, mutual funds and ILS specialist investors still see significant value for their investors despite the fall in market clearing spreads.
So, the market clearing price of oil has to increase," Dalton Garis, Associate Professor of Economics and Petroleum Market Behaviour told Gulf News by telephone.
Sales will be made at market clearing prices on a quality adjusted basis, using a mix of CNF and FOB pricing.
If the objective of the Belgian football clubs is to win as many games as possible, rather than maximizing season profits, it can be shown, using simple economic theory, that players are better-off in a win-maximization league than in a profit-maximization league, because the demand for talent by a win-maximizing club is higher so that, given the supply of talent, the market clearing salary level in a competitive player market will be higher, too (see Kesenne, 1996, 2007; Fort & Quirk, 2004).
In a report posted on its Website, the bank said, 'The evolution of the crisis demonstrated that due to the profit-driven nature of market players, market forces, if unchecked, will lead to asset bubbles and ultimately a disastrous market clearing in the form of a financial crisis like the current one.
Vendors have been painfully slow adjusting their asking prices to market clearing levels and this is prolonging the pain of excess supply in the market.
We assume that the goods market is characterized by competitive market clearing, but firms have some monopsony power as reflected in an upward-sloped or bounded supply of labor to the firm and the ability to set the optimal wage before knowing the price they will receive for their output, which is assumed to be stochastic, and making their employment decision.
Providing investors with the ability to directly establish the market clearing price is a stair-step improvement in transparency, which benefits both investors and the issuer.
These models do not in general assume market clearing and need not assume rational expectations.
Pat Wakeman, principal and acquisitions director in CALCAP Advisors' San Diego office, said the broken condominium project fits in well with its acquisition criteria to purchase distressed assets at today's market clearing prices.
Commencing August 15, 2014, CME Group/Thomson Reuters will operate an electronic, volume-weighted, over-the-counter silver bullion market clearing process to establish and publish a fixed price for a troy ounce of silver once each trading day at Noon London time (the "London Silver Price").