I don’t get your argument and this comes from my cell phone so I will be brief.. Bob has total assets of cash in form of 3m.. Alice has total assets of 3m in a stock. Total assets between two of them equals 6m.. earnings report comes out with negative consequences for the stock, new value 2m.. you are correct bobs assets stay at 3m (1m cash, 2m stock) Alice has 2m in cash from sale. Now total assets are 5m total and 1m is gone.. if all houses went down in value by 1/2 those dollars evaporate.. thus dollars left are more valuable (deflationary)
