Absent DIRECT infusion into housing and the consumer the velocity of money will remain at historic lows and the slow grind of deflation will continue unabated.
If we allow this deflation to run it's course both the nation and the dollar will survive. Absent that, we're DOOMED.
I suspect that civil unrest is in our future regardless if we inflate or deflate...we'll eventually arrive at the same point, severe shortages.
"A deflationary spiral is a situation where decreases in price lead to lower production, which in turn leads to lower wages and demand, which leads to further decreases in price.[12] Since reductions in general price level are called deflation, a deflationary spiral is when reductions in price lead to a vicious circle, where a problem exacerbates its own cause.
The Great Depression was regarded by some as a deflationary spiral.[13] Whether deflationary spirals can actually occur is controversial, with its possibility being disputed by Austrian school economist Robert Higgs.[14][not in citation given]"
A deflationary spiral is the modern macroeconomic version of the general glut controversy of the 19th century. Another related idea is Irving Fisher's theory that excess debt can cause a continuing deflation.