With regard to the penalty for repricing:  How do you see that as affecting the spread you described in the long term?

OK, you're trying to be a market maker in the new system at a specific hub.  You set your prices (750 buy, 843 sell) and say you'll handle 100,000 units at those prices.  At the end of the first trading period (day, week, month) you've badly misjudged the market and sold 60,000 units and purchased 80,000 units.  You're accumulating cows at a 4:3 ratio and need to lower your prices.  During the next period you purchase 20,000 units and sell 15,000.  Your buy order is now filled.  Your sell order still has 25,000 units on it at 843.  You want to pay less for cows so you renew you're buy order at 740 (you could have canceled the old buy order and placed this one after the first period) and when your sell order runs out (or runs low) you renew that at 833.  These lower prices should reduce your stockpile of cows.  But, let's say you're impatient and cancel everything after the first period.  So you cancel a sell order for the remaining 40,000 cows at 843.  The cost to you at 3% is going to be 1,011,600 gold.  Wow, that's a lot, but wait, you've just made a 67.71 (843 * .97% - 750) gold margin on 60,000 cows so after paying the "unfair" portion of the tax you've still earned 3,051,000 gold even while being impatient and really missing the market.  Of course, you don't really have 3,051,000 gold because you purchased an extra 20,000 cows for 15,000,000 gold.  But at the lower prices (833 sell) those cows are worth 16,660,000 gold so in reality you have over 4 million gold in profit from your screw up.  But wait, the cows were selling at 843, just not as fast as you were buying them.  You could have kept the current sell order at 843 and increase your profit even further by waiting until your imbalance decreases to 10,000 or less cows.  Of course, you can only do so as long as you have the gold resources to make it through the imbalance created by miss pricing the market.

How much gold does this take?  Well, you need 100,000 cows and about 100 million gold for this scenario.  You'll "earn" about 5% per period from that investment.  That assumes an "average" hub tax of around 3% and an inability to set margin pricing to market demand.

Most people just want to buy or sell cows.  If your margin is reasonable, they aren't going to jump into the middle of your prices given the barriers to hub trading.  Widening your margin from 93 to 103 (740 buy, 843 sell) probably isn't going to kill business and will also slow the accumulation of cows while avoiding the dreaded unfair tax but at an increased risk of competition.

Obviously, if you are accumulating gold then your sell order will run out first and there is no issue with the tax.  Traders should keep this thought in mind when trying to set market maker prices.

With the old system, there is no way to do this sort of business.  It really doesn't work, too much micro management.  This new system is awesome for people trying to do exactly what you are saying this system will kill, with or without the tax.  Heck, if I had any interest in trading I would  be happy to pay the tax to have access to the trade hubs.  Let alone have a situation where there is an even higher tax on non-trade hub trades pushing business to me.

This is all on the faction hub level.  There will be trading between hubs between traders working in different markets.  I'm not sure how that market will be arranged because I don't know if there is a mechanism for transfer of goods from trader to trader within a hub.

I can't tell you how many times I've gone to buy a certain size lot of goods at a reasonable price and distance and not found anything on the market.  It's the only reason I ever set an order.  In my opinion, there are no players actually making markets out there right now.  If they are, they are doing so as silent players behind the scenes filling only "reasonable" orders.  That is one way to do business but I feel the new way is more transparent and thus better.  I feel this is true because it will allow us (the unwashed masses) to know what prices the market maker is offering and at what trading distance before we enter the market.

I thought about it, and I like the penalty on cancelled sales orders because I think the new system offers real opportunity to good market makers.  I can see an income stream for multi-market market makers in the 10s millions gold/day (for the right player).  That's plenty to support a massive army, 10x bigger than any 10 city player.  I imagine talented traders will build/move their capital cities in the middle of mountains in the most inhospitable places to make sieges as difficult as possible.  They will not worry about pop, so will not have to be concerned with things like sov or food.  They will have smaller "war cities" that are exodused to any location.  After 5 days these war cities will unleash their hordes on the local populations.  No trader city would support their own troops, but would rely on an influx of trading wealth to support their offensive armies.  As such, exodus would do no harm to a trader's city as the city is just a shell for troops and not an economic engine.  A talented trader could have an empire whose economic power is invulnerable to siege or blockade and whose military power is much more mobile and powerful.

I like that there are penalties on people who try this route but can't cut it.  Limited grapes, tax on filled or unfilled sell orders, these are pretty minimal hurdles compared to what's at the end of the rainbow.