The other responses are good as well. Key thing is that you're right that credit gets used for lots of wasteful things in our traditional consumer economy. Buyi

The other responses are good as well. Key thing is that you're right that credit gets used for lots of wasteful things in our traditional consumer economy. Buying a television on credit is not a wise financial decision. However, purchases that improve efficiency or allow new kinds of labor can be good uses of credit. If you can make $1000 more per month at a job that's inaccessible to you via transit, but you don't have $10,000 to buy a car, it would be worth it to get a loan with a $300/month payment, and say another $300/month worth of car-related expenses to net out $400/month income that can be used for saving up for that TV or what-have-you. In terms of items that retain their value, like houses, apartment buildings, factories... no one would be wise to invest in those items in a deflationary environment because if you're interested in growing your net worth, you'd be better off keeping your money in the bank.