J&M defines the agency relationship in a very special case of principal (outside equity holders) and agent (owner-manager) that does not fit perfectly for the contemporary relationship between shareholders and managers. But, we can always gain some implications from the principal-agent relationship to the current system. Why would the sole owner sell his/her shares in the first place, when the total value of firm decreases (nobody wants to buy the share at the price where owner expects to sell or market failure)?