[quote name='Vulgarism']The same problems it has caused before. People upset or not wanting to bid for fear of having more money than they might want on an item. It may be "just a dollar," but it's more of a moral issue. It isn't hard to disregard a bid.[/QUOTE]
I totally agree that bump up rule is just wrong. In traditional rules of a marketplace, a seller can either accept or reject an offer: the seller can't modify the offer at all. A buyer has to make a conscious choice to make a bid, and rule #8 undermines the consciousness of the choice.
It also would appear to encourage sniping using the following trick: you just send out the same bid of say $1 for an item you want via a post to the forum every 20 seconds until the bidding ends and you're basically guaranteed to win it for a dollar more than the last person to bid. You don't even need to know what that other bid was: despite its stated intent, rule #8 discourages people from looking at what the highest bid is since it just goes up by the increment no matter how low a value you bid.
If rule #8 were eliminated, bidders would be forced to look up what the highest bid is or else the bid may be too low to be accepted.
Come to think of it, what if two people played by the sniping trick, each sending out a dollar bid every 20 seconds?
1. Bidder A bids $1 for FooBar for ps3.
2. Bidder B bids $1 for FooBar for ps3.
3. Bidder A bids $1 for FooBar for ps3.
4. Bidder B bids $1 for FooBar for ps3.
5. Bidder A bids $1 for FooBar for ps3.
6. Bidder B bids $1 for FooBar for ps3.
These 6 bids could all take place in about a minute. Quiz: Assuming there are no other bids on FooBar, what's the winning price? Is it $2? Or $6? Why? I think it's $6, if rule #8 applies recursively.
Notice that the only way of answering this is to do arithmetic on the entire sequence of bids: you can't just look for the highest bid. Thus rule #8 not only disincentivizes people from looking for the highest bid, it also makes it difficult to determine what the highest bid is, since the actually realized highest bid is not the highest bid ever written in a forum post.
By bidding in this lowball I've implicitly accepted the rules, but I have to say that I really don't like that one rule, and I don't think I've ever seen it before. I sympathize with the desire to encourage people to make correct bids, but as I said above, I believe rule #8 undermines this goal. So I strongly suggest that rule #8 be removed.