savings and investment are brought into equilibrium with each other in the same way that the supply of and demand for any commodity are brought into equilibrium. For we may define savings and investment as constituting respectively the supply of and demand for new capital. And just as the supply of and demand for any other commodity are equalized by price, so the supply of and demand for capital are equalized by interest rates. The interest rate is merely the special name for the price of loaned capital. It is a price like any other.
