First off .... threaded or threadless headset? Anybody know?
Second ... missing bearing? Not an adjustment issue, eh? Not sure how any of you guys' bikes work, but every bike I have ever owned had upper and lower bearings for the headset. I cannot see any other way it would work. So .... "Loosen this, tighten that" is pretty lame advice.
Third .... I don't care what a salesperson wants to sell me. I am not a child, and I am only half an idiot. If I go to a store to buy a thing, that is what I buy. I do not go for a spare tube and come home with a dozen new bikes ... or even a new tire. If this guy goes to a bike shop to get his bike fixed, and comes home with a new bike ... i will sell him a thousand dreams and wishes all at a bargain price.
Or maybe, he has done permanent damage to the bike and it is simply not worth fixing. Who knows how he got the bearing out, or from where or what all went on back a decade ago? We could be advising him to tighten the stem bolts when he has a threaded steerer and no stem bolts and also no lower headset, while the top headset is rusted, pitted and seized. We simply do not know enough to make a diagnosis.
I was told once that if a doctor starts writing a prescription before asking questions and then making an examination, leave the office before he finishes writing.
This guy should probably not get any more advice about this bike on this site.