the loop

I was going to put this in advanced, but I can’t. anyway, I have been beating my head on the wall trying to find the logic in this.

How does “the loop” work?

I see there is the “have_posts()” function, and I can follow the PHP logic well enough, but I can’t seem to find the actual function.

Am I wrong to assume that “the loop” simply runs through all posts and allows you to pluck and choose the ones for display? Is there some magical condition that is hidden somewhere that makes it only select a certain group of posts to loop through?

Maybe I am missing it, but I cannot find a clear explanation of this anywhere in the codex.