inflation vs deflation mish shedlock in 2005, page-4

A sound argument indeed, but let me question a couple of things:

'This is THE NUT that inflationists and hyper-inflationist can not defeat. Credit and money supply will fall flat if not out and out plunge.'

Not sure about official credit stats in US (no doubt they're down somewhat) but the money supply (not the VOM) is not falling flat or out and out plunging. Its rising pretty rapidly isn't it?

Also much of Mish's argument is based on

'What credit worthy customers will want to borrow? Do we need more cars, houses, TVs, computers, anything?'

ie no-one will borrow

I can't speak for the states, but I know plenty of credit worthy people here in OZ still happy to borrow. I know there's around a couple of billion people in greater ASIA who over the next 10-20 years will strive very hard to be able to buy 'more cars, houses, TVs, computers, anything?'

Finally, Greenspan & Co, as noted by Mish, inflated away the last threat of deflation in the early 2000's. Sure its far more pervasive now, but who says that it is impossible to inflate away again. Obviously it will need to be dealt with at some point in time but Mish is saying it cannot be inflated away this time, yet it was last time?

For sure its a sound argument, but again, I think there's to many unknowns for anyone to be absolutely certain its all going to play out how they expect.