After examining the character of the downturn and existing explanations for it, the article provides an alternative classical Marxian account based upon the methodological and theoretical framework developed by Henryk Grossman. This article investigates the long- and short-run dynamics of capital accumulation in Canada leading up to and culminating in the economic downturn of 1990–2.

One of the leading explanations for Canadian banking stability through the global financial crisis of 2007–08 is the Concentration-Stability Hypothesis (CSH), according to which the oligopoly of Canadian finance stabilised the credit system by cushioning it with above-average profits. These provided a buffer against fragility and incentives against excessive risk-taking. In this article, I critically examine CSH and show that classical Marxian analysis more effectively illuminates Canadian banking stability. I demonstrate that robust corporate profitability and capital accumulation before the crisis (...) strengthened the balance sheets of the banks and supported them through those turbulent years. Thus, financial stability is linked explicitly to broader economic stability, and the latter is linked to the profitability of business enterprise. (shrink)

Canadian capitalism has entered a period of intensified volatility. Rooted in persistent profitability problems, it is facing several challenges, including economic stagnation, a household-debt driven real-estate and construction boom, and an increasingly fragile financial system. Drawing on a classical Marxist framework of capitalist crisis, this article explores the dynamics of instability in Canada and the response of the capitalist state, which centres on increased efforts to export oil and gas to China, thereby deepening conflict with Indigenous land defenders, and a (...) redoubling of the assault on workers to increase the rate of exploitation. (shrink)