> ...resets the prices to some multiple of dividends

But wouldn't you want to pay more for a company that has a history of revenue and income growth than one in a declining industry? And you have to look at assets on the company's books; you're not just buying a company, you're buying a share of what it owns. What if it has no income, but you think there's a 10% chance it'll be printing money in 5 years?

That's why prices won't naively reset to a multiple of ~~dividends~~ income (see the dividend irrelevance theory) across the board. Someone will always put a company's income in context.