I think you forgot the whole point of items. Most people want items for cosmetic purposes, they do not try to get an item because it costs a lot, they get it because it looks good. Of course you are quick to talk when you have millions worth inventory, but most people need to grind for days even to get something like 5k, so no, economy is not bad at all, it just is to you personally.

Sure, items are worth notably less than before, but it is a change that is beneficial for majority of community. Toribash is a game where you got no chance to earn TC with no risk involved unless you're actually good at the game, thus newbies have no chance of breaking through without grinding. Because of that prices are very fair as of now. There are still a lot of collector items that are worth a lot of TC and that's great, but cosmetic items shouldn't cost a lot so it would be accessible to most players.

About sinking items, I don't think it's really necessary. Simply because people come and go, and as a result some items just sink to inactive accounts. Not to mention all the collectors that keep thousands of items on their inventory for years. Again, items should be accessible to everyone and sinking them would only benefit marketers, who aren't in bad position at all at the moment.

EDIT: Also, item price always go down with time and that is a phenomenon that you can see in any game with economy or even real life. You don't see CS:GO trying to sink items for example, it's just a natural process of any market and Toribash shouldn't be an exception.