This article sets out an analysis of interest rates in a simplified model market with only four, sharply distinguished, types of asset. There are shown to be three layers to the analysis: the basic pattern of demand and supply of assets of different types, the demand and supply of money, and the state of expectations. The analysis follows the lines opened up by Keynes and elaborates upon them at some points. It does not fit into static equilibrium theory, but is intended to link up with the analysis of an economy undergoing continuous change and development.