[ClearCase_guy]

I'm probably missing the "nuances", but I think this argument boils down to --

Deflation doesn't have to be the end of the world. A flexible economic system can make adjustments and deal with this.
Deflation is only a big problem if society has lots of government intrusion in the economy and if debt levels are very high.

Fortunately, we are pursuing a wise policy of more government intervention and multiple years of trillion dollar deficits.

Yeah, and when my house is on fire, I throw gasoline on it.

[central_va]

Yeah, and when my house is on fire, I throw gasoline on it

To any economic genius out there: Computer Hardware and Software have been deflating since the 1980's. Why is that different?

[RipSawyer]

http://www.youtube.com/watch?v=2fq2ga4HkGY

[hinckley buzzard]

Well, at the onset of the Great Depression, the government intrusion in the economy was modest, and debt levels were low. The simple problem of deflation is that prices drop because no one has any money they are willing to spend. Many have precious little money at all.

That is why Fed chief Bernanke said he could cure deflation by dropping money from helicopters. The real fact is, however, if he did that, people would scoop it up and save it.