I don't see much deflation outside of wholesale commodity costs.
And when I do, it's related to oversupply issues, not monetary or normal demand issues.
Home prices are still drifting lower in southeast Florida, Las Vegas, and central California, but drifting higher or stable in just about every other region.
Wages and benefits are slightly lower for low skill jobs, but that is related to a massive oversupply of legal and illegal immigrants.
Desktop PC’s cost less, but that is because people are substituting notebooks, tablets, and smart phones.
Video game consoles are cheaper, but that's because of a host of new game playing options.
Taxes and interest rates are lower, but that is because of government manipulation, and could change instantly if we create a currency crisis.
On the other hand...
My rent is up 8% in 2012.
Food up 10%.
Gas up a little from last year.
Health and car insurance up.
Basic clothing up.
Tourism is down ~ PERMANANTLY. There was a time folks took formal trips and stayed precise amounts of time. Today they buy a new battery and lounge on the couch.
Clothing lasts far longer. Machine-made custom shoes are gradually infiltrating the market and they'll really drive down footware costs.
Some hidden costs, like 'design' have dropped precipitously and we still have a 15 year overhang in housing ~ the only place property values are increasing are in critical locations ~ like where I live. Super highway into the heart of WarshDC itssef, a ginormous subway station, and two different commuter rail systems are a walking distance away. This is the route of the helicopters from the Pentagon to Quantico and points in between. Beginning to look like that transport corridor in Futurama.
Deflation has every reason to not go away