II. Expectational Constraint: The agent must expect that he can sell the related supply so that the revenue from this selling can cover his current demand As to the financial constraint, where the financial resource comes from is not important. It can come from either previous selling or from credit. In the modern credit system, this constraint ms to be somewhat easily satisfied However this does not mean that the constraint does no exist. For example, income identification is often required by banks to issue a credit card Nevertheless this is only a necessary constraint, not sufficient. Even if a producer has sufficient idle cash, he will not demand those inputs used to produce the commodity that cannot be sold Similarly, a consumer will not plan his consumption demand without knowing whether he can (or cannot)or how much he can sell his endowments. We will find that trad itional equilibrium analysis lacks a consideration exactly on this constraint The Expectation as to Sales. We now focus our attention on the expectation constraint. This constraint itself means that before paying for the supply related demand an agent should expect that he can sell the related supply. Then where does the expectation come from? To make things clear, we may define an expectation function, g(N Above S is the expected sale; N is the information available to the agent, cond tional on which the expectation is derived. The major problem then becomes what is the information N? One should note that in traditional equilibrium analysis, the information N is only about price any rational expectations models, agents are only concerned with the future expected price, on which they rely to make their decisions. 4 This ind icates that agents have full-confidence that 3. In this sense, forming an expectation, as we mentioned early (see footnote 1), may also be regarded as a selling activity 4. Muth's original model (1961)is certainly such an example, others, e.g. Lucas(1972), Frydman(1982)among others7 II. Expectational Constraint: The agent must expect that he can sell the related supply so that the revenue from this selling can cover his current demand. As to the financial constraint, where the financial resource comes from is not important. It can come from either previous selling or from credit. In the modern credit system, this constraint seems to be somewhat easily satisfied. However this does not mean that the constraint does not exist. For example, income identification is often required by banks to issue a credit card. Nevertheless this is only a necessary constraint, not sufficient. Even if a producer has sufficient idle cash, he will not demand those inputs used to produce the commodity that cannot be sold. Similarly, a consumer will not plan his consumption demand without knowing whether he can (or cannot) or how much he can sell his endowments. We will find that traditional equilibrium analysis lacks a consideration exactly on this constraint. The Expectation as to Sales. We now focus our attention on the expectation constraint. This constraint itself means that before paying for the supply related demand an agent should expect that he can sell the related supply. 3 Then where does the expectation come from? To make things clear, we may define an expectation function, (1)  S = g(N). Above  S is the expected sale; N is the information available to the agent, conditional on which the expectation is derived. The major problem then becomes what is the information N? One should note that in traditional equilibrium analysis, the information N is only about price. In many rational expectations models, agents are only concerned with the future expected price, on which they rely to make their decisions. 4 This indicates that agents have full-confidence that 3 . In this sense, forming an expectation, as we mentioned early (see footnote 1), may also be regarded as a selling activity. 4 . Muth's original model (1961) is certainly such an example, others, e.g. Lucas (1972), Frydman (1982) among others