Correct way to set up Variables [Was - Simple Accumulating Number Loop?]

What would be the correct way to set up a dynamic
variable?  I did some further research on my question
below, and I still don't have a definite answer to
whether or not use \set or SET.  I did read at
http://www.commandprompt.com/ppbook/x19832 about using
variables in a Function, but that seems like an awful
lot to do [or does MS SQL make it easier than
PostgreSQL?].  Any help, ideas, or clarification are
much appreciated.

-Ubence

--- Ubence Quevedo <r0d3nt@pacbell.net> wrote:

> Date: Thu, 29 Dec 2005 15:26:07 -0800 (PST)
> From: Ubence Quevedo <r0d3nt@pacbell.net>
> Subject: Simple Accumulating Number Loop?
> To: pgsql-novice@postgresql.org,
> pgsql-general@postgresql.org
>
> A friend of mine has created this simple
> accumulating
> loop query for MS SQL 2k5 Express Edition.  I am
> trying to reproduce the same results with PostgreSQL
> 8.1, but am not able to find much useful help on how
> to properly set up a variable of both int and char.
> The PostgreSQL documentation is great if you have an
> idea of what you are doing, but I'm still really new
> to PostgreSQL.  If someone can just point out some
> hints or clarifications as to wether to use the SET
> command or the psql \set command.  Below is the
> query
> in question.
>
> Many thanx to any that can help.
>
> -Ubence
>
> declare @variableint int
> declare @desc char (50)
> set @variableint = 0
> create table counter (countid int , description
> varchar(50))
> while @variableint < 500
> begin
> set @variableint = @variableint + 1
> set @desc = 'The Counter is Now' +' '+ cast
> (@variableint as char(50))
> insert into counter values (@variableint,@desc)
> end
> select * from counter
>