Quote from: sgexpat on May 01, 2013, 09:15:32 AM

The answer is simple. By definition a deflationary (what you mean by this is a currency that is relatively fixed in supply vs economic and technological progress, driving down prices and up the value of the currency) makes it difficult to fund government deficits because there is no option to create money out of thin air instead of taxation.

But the question is: how is that bad? In terms of regular people, would a deflationary currency be 'bad' for us? Many are writing about how loans would dry up. Inflation is good for loading up debt; deflation isn't. People would consume less and save more - this is generally bad for GDP but is it bad for the regular guy?

Implied in this question is: Should only the rich guys worry about deflation or would it be bad for us all?