A key point of fractional reserve banking
When the economy is expanding, more people take out loans, which increases bank credit, which expands the money supply, When loans are paid back, there is less bank credit outstanding, and the money supply shinks.
Economic growth DOES CAUSE INFLATION. Economic slowdown DOES CAUSE deflation.
IT DOES NOT MATTER WHETHER OR NOT YOU LIKE THE SYSTEM. It is what it is. If I am wrong correct me. I like Peter Schiff and agree a lot with what he says, but we are not currently on a gold standard, so to say that economic growth causes deflation is completely incorrect...even if he wishes it were so. I here this every single day and it is so obviously wrong to me. The system is what the system is....ideals will not make you correct.
Please correct me if I am wrong, because that would clarify things.