When you loses wallet, it has the effect of removing money out of circulation. Lost bitcoins still remain in the block chain just like any other bitcoins. However, lost bitcoins remain dormant forever because there is no way for anybody to find the private key(s) that would allow them to be spent again. Because of the law of supply and demand, when fewer bitcoins are available, the ones that are left will be in higher demand and increase in value to compensate.
Yes, if you lose your wallet together with your private keys, your bitcoins will be lost forever, in oblivion. However, there might be a chance to find the private key in the future once more sophisticated super computers can break and hack your wallet. And yes, as per supply and demand, with less the 2 million bitcoins to be mined, but the demand is even higher in the next 5 years, its pretty obvious that the current price can double or triple in the future.