As we have argued before, deflationary indicators are showing up in many places.
The total amount of consumer debt is now falling. From an Austrian perspective, money supply amounts to all forms of cash and credit. Therefore, this is a highly deflationary indicator that would take enormous effort by the Fed and other Central Banks to overcome.
In this blogger's view, deflation is the manner in which an economy is repaired so that it may be revived as the market is allowed to reallocate capital efficiently.
It does appear that Central Banks will continue an attempt to fight this medicine. Whether they can overcome deflation by money printing resulting in mass inflation remains to be seen.