I'm all for an auction house, or even a bazaar type thing

I'd love to sell my stuff but can't stand the trade channel.
One person earlier brought up a good point about an auction house though... it makes trading so easy that inflation might skyrocket.
Imagine this:
There's a good sword up for auction. Before the auction house, the seller would have to advertise in asecelon 1 and have exposure to something like a hundred players. Out of those hundred players, the highest bid is 5k. ok done.
But now in the auction house, all it takes is one player who REALLY wants that sword, he puts a 30k bid on it. He wins.
Seeing this, everyone else who is putting up similar swords set the startin price at 20k, in hopes of similar profit... And so on.
So basically the auction house has exposure to so many people that an extreme spike in price is easier and also more easily noticed by the whole community.
I'm not sure how auction houses in MMORPGs work, as this is the first i've played. Anyone care to enlighten me on how inflation might be curbed? I'd love to see an auction house in GW... one of the first features they should have worked on IMO :P