Isn't that your contention, that prices will drop and that this is deleterious? You said the price of sold goods (someone sells all the goods that go into making a car) and salaries will decline.
And usually you don't expect to be forced to drop your prices 3% each year, while your debt becomes harder and harder to repay.
You do in a hard money environment when the government and the banks aren't inflating the money supply and destroying the value of same, no different really than how businesses have to try and factor for inflation now.
And when housing drops year after year, it probably isn't a wise investment.
You want to sleep under the bridge? I plan to sleep in my house. I'll have it long after I've paid it off, and even if I chose not to make higher payments I'd still have it to sleep in during the length of a the mortgage. You seem to ignore the utility of a house (the actual reason someone should buy one).
And when deflation crushes the debtors and they default and their banks fail, does that increase savings?
Are you unaware that the savings rate has increased since the recession began? Households are trying to repair their balance sheets and provide a more sustainable foundation for economic growth, meanwhile the government is borrowing even more, worsening the overall environment.
At least you're honest enough to admit this. Most deflation advocates think their buying power will increase because their salaries will remain unchanged.
When their salary drops, will the typical home owner still have to make the same mortgage payment? Same student loan payment? Will that reduce the amount available to spend on those cheaper goods out there?
no different really than how businesses have to try and factor for inflation now.
Totally different.
You want to sleep under the bridge? I plan to sleep in my house.
Where will the people who don't have a house yet sleep? Maybe they'll live in an apartment building? I'm sure there will be lots of them built, knowing their value will decline every year. No worries, the rent they can charge will decline as well. Maybe you should build a few?
Are you unaware that the savings rate has increased since the recession began?
When deflation and bank failures were occurring in the 1930s, did that help the savings rate? When your savings disappeared when your bank went under, could you buy more cheap goods, or less?
Households are trying to repair their balance sheets and provide a more sustainable foundation for economic growth
That is a great idea. It's easier when deflation isn't causing business failures and layoffs.