Your negative reaction to my comment about the gold standard is misplaced. I only mentioned it to explain the historical characteristics of the money supply, namely the stability of prices during the 19th century. I'm no goldbug and do not particularly care that money has to be backed by anything.

> And making more money over time is a means of measuring "real value" creation.

This is only because that's a characteristic of how the modern money supply works. Money itself does not create value; if tomorrow the money printer turned off and from now until the end of time everyone worked with a fixed quantity of dollars, that would not stop value from being created.

> However companies are required to make a profit in order to continue to survive. Otherwise they run out of money eventually.

They could break even. Anyway, there is economic profit and normal profit. The latter refers to profit on the balance books, while economic profit accounts for the opportunity cost involved. In the pure competition model, the economic profit is driven to zero, yet companies making no economic profit will still survive. If a company can year over year make enough money to pay for its expenses and the expenses of its employees and operators, it will survive. It could make less money one year than the year before, but if its expenses declined as well, it can continue (note that this again doesn't entail less value produced, as more real products could be produced for a lower price). There's nothing fundamental about a deflationary currency that would prevent a company from making enough money to meet its costs.

> I wouldn't care to live in the 19th century, when the price of wheat only increased by 10 cents/bushel decade-over-decade, if I couldn't afford enough food to feed my family.

> Moreover, given how different everything in the 19th century was (open immigration, tons free land to settle, tons of newly discovered resources, less competition for everything, less well-developed capital markets, less global trade), I'm skeptical about how useful it is to compare prices of consumer goods back then to now.

I only spoke of the 19th century only to point out that economic growth is not the cause of inflation, as you had asserted above (with a possible exception in the short run as I mentioned above). It is caused by an expansion of the money supply.

Whether inflation or deflation are good or bad are separate arguments. I think both can lead to problems. Deflation encourages people to hoard money, as a productive investment that isn't productive enough could lose money; without deflation, even if you don't beat the opportunity cost you could have made, at least you're better off than if you had just kept your money as cash. Inflation, on the other hand, encourages risky and speculative investment. It is no coincidence that cryptocurrencies have exploded in price in the cheap money, low interest rate environment we currently have. Anyone who saves money in a bank is essentially losing money. So a good deal of money has been created, and it goes towards chasing any type of asset that is appreciating in value - stocks, land, and cryptocurrency. The S&P 500 has doubled in value in the last five years, but the economy did not even nominally grow by 20%. It is a recipe for a bubble, or worse if the Federal Reserve decides to try and keep that bubble from popping by any means necessary.