How does the Elo rating system work in a situation like this?

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The Elo rating system is commonly used to rank chess players, giving some insight into the probably of one player defeating another, but how would it react in a situation where there are three players whose games consistently end in the following way:

Jenny defeats Phil
Phil defeats Andy
Andy defeats Jenny

If each player begins with an Elo score of 1200 (as is usual), what happens? How is the score affected if they play other "ranked" matches with people outside that circle?