Capitalism is an economic and political system characterized by free trade and competition in the service of accumulating capital. Lenin distinguishes between early capitalism and late-stage capitalism, the final form of which is imperialism. Early capitalism is defined by free trade, free competition, and economic health that supports entrepreneurs and the flow of capital and material goods and services. Late-stage capitalism is the inevitable decline of capitalism: Monopolies accumulate capital and power and replace free competition.

Imperialism is the final stage of late capitalism. National and international monopolies and cartels manipulate and control economies, markets, and international relations. Imperialism is characterized by its colonialist designs and its exploitation of colonies and territories—which it divides by force and retains by threat of violence. Under imperialism, the principal export becomes capital, rather than material goods. The centralization and conglomeration of finance capital by banks allows the financial oligarchy to manipulate markets and prices. In theory, this allows unlimited financial gain.

When a market is devoid of genuine competition, this creates a situation where a single supplier or industrial corporation provides a particular good or service. Monopolies allow for price-gouging and exploitation since there is only one source of a necessary or desirable product.