Doesn't that incentivize speculation, bubbles and misallocation of capital?
Contrast this to the status quo of negative real rates. Speculative mania, valuations over dividends and FOMO driving investment cycles into increasingly absurd tulip bubbles.
Despite increases in productivity, consumer prices continue to increase. Families have two spouses working and less leisure time. There's nothing wrong with deflation. This is the natural result of increased productivity and technological advances.