Investors are often warned about October, a month that is notorious for market slides and crashes, and this October is off to an early start.

With the Toronto Stock Exchange down some 240 points as of 11 a.m. ET Tuesday (having bounced back from a nearly 400-point slide at the opening bell), Canada's leading stock market has lost around 1,000 points in the space of a week.

As the Globe and Mail reports, the TSX is down 12 per cent since the beginning of September, and more than 21 per cent since the spring, having touched a 13-month low on Monday. That officially makes the TSX a bear market, which is defined as a sustained drop of 20 per cent or more.

The TSX has been getting hit particularly hard this week. While Toronto was down more than 200 points Tuesday mid-day, New York's Dow Jones had registered only a 150-point drop.

Behind Canada's market slide are growing concerns among investors that the developed world is sliding back into recession. Those concerns have sent oil and commodity prices spiralling downwards, and taken Canada's commodities-heavy stock markets with them.

The Canadian dollar -- also seen as a commodities currency -- has felt the brunt as well, dropping sharply Tuesday to nearly touch the 94-cent U.S. mark. The loonie has lost close to six cents U.S. since it dropped below parity on September 21.

"It has nothing to do with Canada," Neil Matheson, senior VP of investment strategy at Standard Life told the Globe. "The reaction is more about what's happened to the outlook for global growth."

John Kurgan, a market strategist at MF Global Canada, says the TSX slide is all about oil. "Crude oil really peaked in April, and that's when we saw the peaks in the TSX," he told the Globe.

Oil slid towards $75 per barrel on Tuesday, wiping out 15 per cent of its value, or about $13, since the start of September.

Responding to the unfolding crisis, Finance Minister Jim Flaherty said Wednesday he's confident Canada won't slip into a new recession, but he added the caveat that he would not hesitate to run budget deficits to prop up the economy if it did.

In the U.S., Federal Reserve Chairman Ben Bernanke sounded somewhat less optimistic, telling a congressional committee the U.S. economy "is close to faltering."

Bernanke said the Fed "is prepared to take stronger action to promote a stronger economic recovery in the context of price stability."

That suggests the Fed may be preparing for another round of quantitative easing -- increasing the amount of cash in the economy by buying debt held by banks. But his mention of "price stability" suggests he may be worried that more cash in the economy could lead to runaway inflation. And that, in turn, could mean a more tepid response to the crisis than some would like.

Bernanke said households are having a harder time finding credit, and he blamed the debt ceiling fight in Washington in August, the ongoing debt crisis in Europe, and government spending cuts for that phenomenon.