"The starting list count" ?????

[Alan Mackenzie <acm@muc.de>]

Hello, Emacs.

I'm trying to make sense of the form whose printed syntax is

    (1 . #1)

which arises in the Emacs test suite file seq-tests.el.  I'm having
difficulty.

The Elisp manual page "Special Read Syntax" says about it:

   `#N'
       When printing circular structures, this construct is used to
       represent where the structure loops back onto itself, and `N' is
       the starting list count:

            (let ((a (list 1)))
              (setcdr a a))
            => (1 . #0)

..  What does this mean, please?  What does "is the starting list count"
mean?  There is only one "list", so what is the "list count"?

Clearly the N in #N is counting something, but what?  What is the
meaning of

    (1 . #1)

?  What is it about the description in the manual which is so perplexing
me?

Help!

-- 
Alan Mackenzie (Nuremberg, Germany).