Coming to a Store Near You: Deflation

It's not the deflation that is so interesting but the third step in the chain, the policy response' effect on asset prices.
From the FT Alphaville Tumblr:
The deflation gang

We’ve written about it before but it bears repeating. China and Japan are ganging up to send deflation abroad and, in doing so, boost asset prices.
From Deutsche’s Alan Ruskin on Tuesday:

Firstly, China is a disinflationary force not only on the commodity side, but on the non-commodity goods side: US import prices from China declined -0.1% in April, and were down 0.9% y/y. Secondly, and more recently, import prices from Japan have declined sharply and are down 1.3% in the last 3 mths alone. This of course fits with USD/JPY having a significant disinflationary impact in the US. In the global context, Japan is having a dual influence - directly reducing import prices abroad...MORE

You'll have to follow the jump for the punchline.