You can even have an across the board price drop due to improved productivity. Think of the currently improbable Star Trek replicator. It would drive production/labor/material/transportation costs down to near zero. It would be a good thing, too.
My point is post and pre-Fed recessions. The Long Recession didn’t really happen the way these modern, post-Fed recessions happened. There was large real growth. There were price drops across the board to match wage drops. There also wasn’t a permanent spiral. Eventually, the prices dropped to a point that people reentered the market and prices stabilized.
The Great Depression was directly caused by the Fed and fiscal policy by Republicans and Democrats. What’s changed since then? The Fed responded quickly, but fiscal policy hasn’t changed. Central planning the American economy doesn’t work. That’s my argument.
The fact that we can imagine something good about widespread deflation doesn't mean it will ever happen or that we should act like it's going to happen next time. What we know for sure is that we've suffered horribly from substantial drops in general price levels even though there have also been other times when we've benefited from occasional price drops in specific goods or services.
The Great Depression was directly caused by the Fed and fiscal policy...
Interesting, we were just talking about that here, the way some folks say "the '29 crash caused the Depression", or "Smoot-Hawley tariffs caused the Depression", or "Hoover's fault" etc. etc. Life would be a lot simpler if big historical changes were totally due so some easy blame target, but its always good to watch out for other things going on. What we're talk about is deflation though, and off hand my take is that the Fed being bad doesn't make deflation good.