Buy low, sell high. When prices are very low it is often a great buying opportunity for those who are able to do so.
About hyper-inflation, that is not a 100% certainty but many people and analysts believe that is what we are headed towards.
The "deflation" that we have been witnessing this year is not monetary deflation but rather asset deflation. The money supply has actually been increasing. Much of the stock price drops have been due to the unraveling of leveraged investments. The bad economic conditions are also moving investors away from the weaker non-proven companies.
The federal government, as well as state and local governments, desperately need money to pay the bills. The options are to either tax more, borrow or the federal government can print the money. Taxing will wreak havoc on the economy even further. Borrowing is difficult because the US government is not as credit worthy as it once was, which our lenders are learning. Printing the money will inflate our economy. The inflation, or hyperinflation, will be disguised as a great rally in the stock markets - but you'll know for sure when things like bread, milk, eggs and other products are several times more expensive than currently.
There has also been some talk in Congress about virtually confiscating retirement accounts and converting them (selling off their stock holdings) to 30 year government bonds with the accounts being managed by the social security administration. If the government does this it will not only be a great affront to our Liberty but it will also be a huge loan to the government which will not cause inflation (but it will cause a very big decline in the stock markets). My guess is that this is not likely, but who knows what will happen when we have a Congress that does not care about what the people really want (99% against the bailouts, 73% against the war, etc, etc - Congress doesn't care what we want).
If you're going to be in stocks you should probably be in those that are profitable, with good dividends and which have a relatively low PE ratio (in my opinion). If you don't mind some risk, there are companies out there that could return a HUGE multiple on your money in short time - but it is risky.