Capitalism is an economic system in which the means of production are privately owned and goods or services are created for income or profit for individuals or corporations.
However, this definition is slightly misleading. Although the goal of capitalism is to provide profit for the business owner this is not always the case.
Many in today’s society like to gloss over the fact that many individuals and corporations lose money and as a result are forced out of the market.
Capitalism is then a profits and losses economic system in which the means of production are owned by individuals or corporations.
Furthermore, Capitalism is a social system based on the principle of individual rights. Politically, it is the system of laissez-faire (freedom). Legally, it is a system of objective laws (rule of law as opposed to rule of man). Economically, when such freedom is applied to the sphere of production its result is the free market. (cited from http://capitalism.org/)
A further look into Capitalism.
Three Myths of Capitalism.