You know what also encourages spending? Appreciating currency that lets you save money over N days to buy N*$ expensive stuff all by yourself (e.g. start your business) without getting into debt and serving your creditors instead of yourself and your customers.
This feels a bit like "common sense/stands to reason" thinking. In reality, of course, periods of deflation are typically very bad for businesses, particularly small businesses.
I guess we are talking about different deflations.
If the prices fall because economy crashed (e.g. due to an inflated credit bubble beforehand) and now everyone is without spare cash and broken/useless production chains, then sure - no one is buying stuff because life is miserable.
But if the prices fall because everyone's savings exist and appreciate, then arguably, people can afford more things tomorrow than yesterday, which could only cause them to spend and invest more.
Rising prices due to monetary inflation only "stimulate economy" (whatever it means) on a short distance while people have money to spend and are forced to get rid of it for something more useful. But that's not a sustainable game.
