Here is a very interesting article titled "How a Gold Farm Works" and it's
gonna be very long.
Here is a most informative post in the thread:

-----BEGIN QUOTE-----
I guess I should mention, as I failed to in my last post, that I have been in
the process of dismantling my "business" since Christmas. You may wonder why I
do not just fold it up completely and immediately, but that lies in needing to
make sure that those I am responsible for, are taken care of. I expect to be
completely done within the month.

This is going to be long, but I'd like to explain what my business essentially
was, and my views on things in general and why what is currently going on is
quite serious for EQ. Not just for the plat sellers like I was, or just those
who rely on bazaar gears and trading to equip their character, but also those
at the raiding level. While it certainly impacts raiders the least, it does
eventually.

I started selling about 7 years ago. I started on my home server, amongst a
few other sellers. At the time EQ was EQ, no expansions, fairly new, and you
could sell 1,000 platinum for $500. I got into selling because of a GM at the
time who I spoke to on occasion who was selling platinum and other items from
places like mistmoore, guk, and solusek b. This was at a time a GM was an
unpaid volunteer player, and the kinks hadn't been worked out as far as the
EULA which forbid the buying and selling of intellectual property.
......

Link from: http://www.trade4game.com/html/news/23.htm