THE BANKRUPTCY of the LTV Corp. is a melancholy event, and another marker of the deflationary trend that is now visible in many American industries. LTV built its strategy on a firm faith that the decline in the American market for steel was only temporary and would shortly have to reverse itself. But that hasn't happened. When other companies were getting out of the steel business, LTV got more deeply in -- most notably with the purchase of Republic Steel two years ago, making it the second largest steel producer in this country. It developed a specialty in tubing for the oil industry, and then the price of oil fell. There was plenty of bad luck in the story, but the central mistake was to misread the continuing slide in American demand for steel.

Steel prices have fallen as much, over the past half-dozen years, as agricultural prices. The steelmakers, like the farmers, are afflicted by their capacity to produce much more than they can sell. The steelmakers were gripped by the idea of a great expansion of sales ahead; the farmers, like the oil producers, had had a great inflationary ride up in the 1970s and now have gone through a brutally deflationary ride down.

The troubles of all of these industries are now feeding back into the banks that financed them. The First National Bank and Trust of Oklahoma failed on Monday. LTV is the biggest bankruptcy in the country's experience, and First National of Oklahoma is the second-biggest bank failure. On Wednesday the BankAmerica Corp. in California reported gigantic losses in the spring quarter that has just ended. That's a result mainly of oil, real estate and foreign lending.

The inflation rate in this country over the last six months has been just about zero. But it doesn't mean that all prices have been stable. Some prices -- most of them in the service industries -- have been rising rather fast. Falling prices in other industries have compensated. There is much prosperity in the United States, but most of it is distributed along the two coasts and concentrated in the cities that specialize in services -- Washington, for example. Inland, things are less reassuring. It's possible to speak of two distinct American economies, one expanding and more than slightly inflationary while the other contracts and deflates with dismaying speed.

A steel company that makes serious strategic mistakes runs a risk of bankruptcy even in the best of times. But a broad and continuing pattern of deflation is dangerous -- another of the economic dangers that no one in the administration seems to want to discuss much in public.