Understanding the effects of inflation and interest rates on the valuation of stocks

I've seen people say, “stocks go down when interest rates go up”, and “stocks go down when inflation goes up”.

Why would anyone or any investors bail out of stocks and hold cash or put money into bonds when it's a guaranteed loss, a slow steady burn down of purchasing power?

Also, high inflation has already happened, and it's going to continue to happen in some degree or another. So, say a stock was valued at $100 prior to rapid inflation/devaluation of the dollar. Why would people sell their shares for less than $100 when EVERYTHING else costs more? I suppose when I think of time or assets, I'm continuously considering opportunity costs. “100 shares of XYZ is the equivalent of a new car. I can trade these for a new car”. If I socked away those share, made that investment with specific objectives in mind, as I think most people do the same (we're not saving and investing for the sake of seeing accruing numbers, we actually want to exchange those numbers for something real one day), anyhow, if I socked them away for a new car, and then the price of cars and everything goes up, I'm not selling those shares for LESS than what I paid, and even more so, I'm not selling them if I can't get that new car… or house… or retirement, etc. In short, to me devaluation of dollars means I need more dollars for a car and anyone wanting my shares needs more dollars for them as well. Is this irrational? Why wouldn't inflation push up the price of stock in the same way it pushes up the price of everything else?


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