chapotraphouse

It's because of debt: when there's lots of deflation (and when there actually is deflation and not just one particular good getting cheaper), the value of what's owed increases far beyond what was gained by taking on the debt in the first place. That can lead to things like debtors being unable to pay back loans if the deflation means they're not making as much as before.

A good example that I remember from one history class or another (I remember it specifically because the test on the material got it wrong, and the dipshit teacher thought it was about inflation instead of deflation and I'm still pissed about that 20 years later) was farmers in one of the decades of the late 19th century being hurt by deflation because all their machines and supplies were bought with debt but the value they could get out of the crops was suddenly worth less than what they owed for growing those crops in the first place. Which, uh, actually seems relevant now, depending on the economics of farming in China.