"Transitional issues are often perceived to present a formidable obstacle to the enactment of a consumption tax reform. Although a wide variety of transitional problems would arise with such a reform, most discussions have focused on two issues. First, in the absence of transition rules, the enactment of a consumption tax reform might result in a one-time fall in equity prices. Under a value-added tax or national retail sales tax, this would most likely occur due to inflation in the form of a one-time tax-induced increase in consumer prices that would reduce the purchasing power of existing real assets."
And in a previous paragraphs toward the top he says that inflation effects have not been sufficiently modeled. And in almost the next paragraph (in front of your quote) he says that the tendency would be for asset values to fall. Which is it?