If it is rotting, it will not repair itself and rot will spread everywhere (it may be fast). I don't know why it is white (is it actual stem?), but skin just above looks like it is separating. It looks like it is dried out, but it could be soft and that is rot. And it seems to be dark and soft below the damage too.

Regardless of what exactly is wrong, I would think that best thing is to cut the stem above damage. See if it is green inside. If you see any black spots, keep cutting in small increments until you don't see it anymore. Don't leave anything black in there, that would be rot spreading. Even if you end up with just a short healthy piece, it is better than hoping to save longer piece by leaving disease in it.

Leave cut piece to callus for day or longer (as necessary according to thickness of it). Then pot up in better draining mix - what's visible in your photo looks too dense or peaty and possibly water-retentive, that's why your plant has rot.

Take remaining stem out of soil and see if it rotted all the way, perhaps even roots. If it is long enough after cutting mushy parts off and roots are healthy, you could pot ir up and it most likely will start growing new shoots.

Hello again! I cut the stem. The stem stump that's left had no rot in it therefore I think the roots are fine. Will they grow new shoots? The stump left, however is small so I don't think it'll get that much light from my window since it is kind of hidden blocked by the pot. What should I do about this?

ALSO. FOUND OUT THAT IT WASNT ROT. Looked around the "rotten" part of the stem, then saw an insect living inside. Now, the stump that is still rooted and the stem that I cut off has no more black parts (and hopefully no more insects) But don't know how to proceed anymore. Advice would be helpful. Thanks!!!

Will they grow new shoots?

It may be worth examining the roots after cleaning them of soil and get a free lesson on bare rooting and treating an infested stump/ root system for pest and eggs elimination/ eradicating.

New shoots from the stump after an unknown pest infestation ? The cycles continues as pest lay eggs, eggs hatch, hatched eggs do more damage and also lay more eggs to hatch I'd lean toward doubtful

Is this the same leaning plant from your other thread?

http://forums2.gardenweb.com/discussions/3324661/questions-about-my-jade-plant-new-at-this-d

Are all of these stems connected, as in one plant? I agree with Nomen - you should look to see what is happening with the roots and pests. You don't want your problem to spread to the other nice plant.

This would be a fine time to separate the plants if you would like to do so. Your call, of course. And pot them up in an appropriate soil with the peace of mind that you have eliminated the chance of the problem getting to all your jades.

Good luck!