Please change taxes...

[Zigkid3]

Kazamoto: It will stop when sellers are not willing to undercut any further because they'll have an idea of how much people are willing to pay for the said item, this will eventually stop people from trying to flip items. Then you have the people that aren't flipping, but got an item by other means, theyll post it up and probably will try to undercut a little if they want to sell it right away, if they do, someone will buy it right away and take it off the market. When prices reach equilibrium it's not like it's set in stone forever and cant be changed, there will be a tiny amount of fluctuation but it will hover around a certain point. If the fluctuation is small, it's relatively stable; if there's a lot of variance in prices then it's not stable. anyone who sells below equilibrium, their item will sell fast because its too good to pass up or flippers will have an opportunity for arbitrage, if you sell above equilibrium then no one will buy it and then you're forced to sell for lower.

For things selling at 1g, you're probably seeing this with items that can be bought from a vendor. I'll use cinnamon for example since this is something I actually did. Cinnamon can be bought from a vendor for 4gil, but can only be sold back for 1g. What I did was I noticed the price for cinnamon was way higher on the market than 4gil, I took advantage of this. I bought 100 cinnamon's for 4gil each, sold them in stacks of 5 for I think 80gil each at the time, made 8,000-400=7,600gil profit. People began to catch on that this was an item that could be bought from a vendor for only 4gil. As a result the price tanked down to 4gil, the vendor price (luckily I stopped when I saw the trend of people undercutting down to the vendor price). Everyone else who bought from the vendor for 4gil could either hang on to it and use it themselves, but for those who bought a bunch or people who found it through the game and have no use for it would rather undercut 4gil than get 1gil from an npc. so for those who have cinnamon but don't want it, would want to sell to the market since they can get more than 1gil, but it also needs to be under 4gil. As a result it's going to hover around 2-3gil or even 2-4gil. As for those selling at 1gil, there is no reason to do this since they could instead vendor it for 1gil and get their money right away and not be taxed. I noticed people selling animal hides for 1gil each, same as the vendor price, I bought all of the ones for 1gil and sold them to a vendor and got rid of some supply from the market and increased the price to 2gil. Though I could've maybe sold them for 2gil each instead and double my earnings. If anyone were to undercut and put it up for 1gil again, i could buy it myself and sell for 2gil. then if i was done with the animal hide market I could vendor the rest that never sold for the equal price. So if it drops to 1gil, someone could do that. Anything that could be bought from a vendor that is selling on the market would range from a price of how much it vendors for+1 to how much it can be bought at a vendor, and would hover within that range.

That is for items that can be bought from an npc though. Anything else that can not be bought from an npc however, the price would be player driven and decided by the players.

Sotek: At this point I'd just be repeating myself to you, just go take another look at the graph I showed you with how a tax effects the market. We know that if an item is taxed when it's posted and for any price adjustments, the game will tax more overall than if it was only when an item was sold. So we already know it's going to increase, the issue is how that tax hike would effect the market.
However I do like your other alternative much better of implementing a cooldown for adjustments (not taking away space though). Taxes wouldn't increase, the supply would stay about the same. The only thing is that the supplier's turnover rate would become worse, which would mean slower markets which is what you want but at least this way the prices will stay the same instead of increasing. Though personally I would prefer a faster market than a slower one, but it's way better than the original proposal.

edit: good to know that you can bypass the 1000 character limit by doing an edit. so annoying.