True. But here's what it would affect. If you are a huge company, or a government, with an extremely large negative net worth (ie. you loaned loads of money).

True. But here's what it would affect. If you are a huge company, or a government, with an extremely large negative net worth (ie. you loaned loads of money). Deflation will cause : 1) your income to go down by more than the deflation amount 2) your loans don't go down So deflation will kill large companies very quickly, and put governments in a really difficult position.