Half a sentence this time, from Charles Hugh-Smith. It’s rare for me to agree with anything quite this much:
… deflation is the natural result of a competitive economy experiencing productivity gains.
(He continues: “isn’t this the ideal environment for innovation, enterprise and consumers? Yes, it is.”)
According to the Outside in definition, deflation is the basic signature of capitalism. It’s the politically-undirected (i.e. spontaneous) distribution of positive externalities from sound economic order. Inflation — or mere deflation-suppression — is the unambiguous signal that something very different is going on.