I think it's the Greater Fool Theory in action. It was real popular before the great Stock Market crash, and it generally stated that however much you paid for something, there's always someone else willing to pay even more for it (i.e., someone stupider than you). Unfortunately, it was when people started to doubt this theory that caused the crash in the first place and started the Great Depression.
My other guess is that these people are out of things to trade for, and so they're going for broke. Anything they actually need, they can probably negotiate in forums like this one, which you can't really do in the GTS.
By the way, if you find a level one male Piplup by the name of James Bond offered by a trainer named Minnie in hopes of getting a Mismagius (at least, until midnight PST), you may be pleasantly surprised to note that it knows Aqua Ring. ^_^ Enjoy.