Capital market developments in the post-October 1987 period: a Canadian perspective

Laurence Booth and Sean Cleary

Review of Accounting and Finance, 2009, vol. 8, issue 2, pages 155-175

Abstract: Purpose – The purpose of this paper is to review the evolution of the Canadian financial environment since the stock market “crash” of 1987. Design/methodology/approach – The paper provides a chronological account of significant events in the Canadian economic environment and capital markets, and how they have transformed the financial climate. Findings – The late 1980s was a turbulent period with many changes in government and economic policies which were initiated at a time when governments were wracked with fiscal deficits, and just as the central bank appointed a dedicated inflation fighter. These changes worked their way through the system to contribute to one of the worst recessions in Canadian history. One of the symbols of disparity during this era was the Stock Market “Crash” of 1987, which was felt in Canada, as well as around the globe. However, for the last decade, the federal government has reported a surplus every year, and Canadians have benefitted from falling tax rates, declining interest rates, a strong stock market, and a rising currency. In fact, until September of 2008, all of these developments had contributed to unprecedented profitability in the financial services industry, until the recent widespread economic crisis in the US spread to Canadian and global economies. However, the Canadian economy seems much better poised to deal with such adversity than it was in October 1987. If the fall of 2008 is any indication, we will find out soon enough. Originality/value – The paper demonstrates how fallout from the crash of 1987, as well as other subsequent developments, has contributed to significant changes in the financial environment.

Keywords: Canada; Capital markets; National economy; Stock markets; Stock prices (search for similar items in EconPapers)
Date: 2009
References: Add references at CitEc
Citations Track citations by RSS feed

Downloads: (external link)
http://www.emeraldinsight.com/Insight/viewContentI ... le&contentId=1789976 (text/html)
Cannot be freely downloaded

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:eme:rafpps:v:8:y:2009:i:2:p:155-175

Ordering information: This journal article can be ordered from
Emerald Group Publishing, Howard House, Wagon Lane, Bingley, BD16 1WA, UK
http://www.emeraldinsight.com/raf.htm

Access Statistics for this article

Review of Accounting and Finance is edited by C Janie Chang and Janis Zaima

More articles in Review of Accounting and Finance from Emerald Group Publishing
Series data maintained by Chris Harris ().