Look at Fig. 4.18 on the next page. Why has the stem below the ring stopped growing and even slightly decayed?

The stem bellows the ring has stopped growing and even looks slightly decayed because the phloem of the woody stem has been removed by girdling and thus, the lower half of the trunk is not receiving any nourishment.

Note: Girdling is a process in which a ring is cut around the stem of a well nourished tree, deep enough to penetrate the phloem but leaving the xylem intact.