> It is not harmful to people going long with their own money, but it is a huge risk to margin traders
Yes, appreciation on assets is great for owners.
But when talking about currencies (i.e. standard medium of exchange), it is the overwhelming consensus that deflation -- especially rapid deflation -- is harmful to an economy. The Great Depression being the most dramatic example of a deflationary spiral.
So you are saying, fractional reserve, paper money indistinguishable from IOUs and subsequent credit expansion blessed and coordinated at the federal level (with creation of the Fed) are totally not among the reasons that caused market distortion and subsequent collapse?
Yes, appreciation on assets is great for owners.
But when talking about currencies (i.e. standard medium of exchange), it is the overwhelming consensus that deflation -- especially rapid deflation -- is harmful to an economy. The Great Depression being the most dramatic example of a deflationary spiral.
https://en.wikipedia.org/wiki/Deflation#Effects