The process you imagined will only produce the opposite outcome: when the price of MS stock plunges to zero, Gates himself will likely buy back all his (confiscated) stock and since MS the company operates independently from the stock market, the real value of the company is not destroyed, and will likely bounce back when Gates buys back all his stock. Soon he will regain all his lost wealth and be filthy rich again. This actually happened in 90s Russia: when the former Soviet Union was no more, then Russian government issued every citizen shares of the SU state owned entities - factories, OIL FIELDS, etc. As you rightly pointed out, ordinary Russian citizen didn't know what to do with these "shares", they dumped them cheap. Some enterprising individuals then acquired them cheap and that's how the Russian Oil Oligarchs got their wealth.