MMO Economies

After reading some viewpoints on MMO balancing it is obvious that MMO developers spend a lot of time balancing the game specifically to make item-trading a positive aspect of the game. And one of the worst things that can happen to damage an MMO, is that the internal economy is destroyed by cheaters or by some item unbalance (maybe a necklace that gives too much of a bonus). I didn't understand why developers where so frantic about this when I first come heard of it, but I now see that a damaged MMO economy results in rare one-of-a-kind powerful items being sold for very little and everybody having them as soon as they start a new character. Meaning that the gradual progression of collecting more powerful items is eliminated.

Economies can quickly become damaged by bugs in a game that allows item duplication. And that is exactly what has happened to World Of Warcraft (SlashDot).