The asinine debate between inflation and deflation continues. Disinformers can always point to some profit cartel that retains pricing power such as the University cartel or the MedeCine Cartel. What inflationists never admit is that in a world of falling wages, if something is going up in price, then pretty much everything else must be going down. Suffice to say the gasoline "tax cut" went straight into debt repayment and tuition, bypassing the rest of the economy. In short, deflation is an ever growing output gap. It's too much junk chasing too few dollars.
The U.S. output gap is an asinine 22%:
You can't see it on this weekly chart, but on the dailies, oil just briefly touched 2009 - see next chart...
Well at least retailers had a good fake bounce