Professional Farmers

[fractaled]

It would be interesting if market forces could be introduced to automatically balance vendor sale prices.

Here's a sketch of such a system:
Vendors offer for sale (at a large markup) everything sold to them.
Vendors adjust their sale prices (and, accordingly, their buy prices) for X depending on how much X they have in stock, and how much they expect to be able to sell it for.  (They could also snoop on AH sales to some extent.)
Vendors could also buy from other vendors at a price marked up by transportation distance.  This would produce interesting effects like iridescent pearls being more expensive in the Barrens and cheaper in STV.

of course this would be irrelevant to truly useless (grey) items.  It's an interesting thought experiment though.  Players would always be discovering areas where inefficiencies existed (say that the price of pearls was too high) and balancing those out (by, for example, farming pearls.)
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I think such a system would be a good first step for the economy of the game. As you point out, gray items, being worthless, should have no value (and should be taken out in my opinion). This would require them to make a lot more items with uses, or drop more existing useful items, or change non-useful drop to gold drops (which doesn't make a lot of sense for non-humanoids).

Right now there aren't enough perishable items to create a demand for drops. Basically just potions, enchants and kits, and crafted items. And the volume of all but alchemy (and maybe enchanting) is probably too low to sustain those professions and the economy as a whole.