ABSTRACT
The capitalist is not primarily concerned with the absolute price level of his product, but with the relation between the market price and the cost price, or in other words, with the level of profit. A crisis involves a slump in sales. In capitalist society this presupposes a cessation of new capital investment, which in turn presupposes a fall in the rate of profit. Every industrial cycle begins with an expansion of production, the causes of which vary according to particular historical circumstances but which in general can be attributed to the opening of new markets, the establishment of new branches of production, the introduction of new technology, and the expansion of needs resulting from population growth. A crisis begins at the moment when the tendencies toward a falling rate of profit, prevail over the tendencies which have brought about increases in prices and profits, as a result of rising demand.
