Fed report on lending practices confirms the obvious: deflation

From CalculatedRisk post, here's a quote from the Fed's April 2010 Senior Loan Officer Opinion Survey on Bank Lending Practices

The April survey indicated that most banks kept their lending standards unchanged in the first quarter, but that moderate net fractions of banks further tightened many terms on loans to businesses and households. ... The survey also indicated that loan demand generally weakened further.

Take away from the report? The lowest borrowing in history, and unchanging lending standards are not creating any new demand for credit, loan demand weakening is a highly deflationary phenomenon.
The Greater Depression is settling in for a long time. Look at Japan as if it was a crystal ball showing what will happen in 20 years in Europe and the US.