Questions about items and vagabond

  1. What happens when items run out?
  2. Does items have any other use, besides trading with the vagabond?
  3. Where do items go when the vagabond discards them?
  4. When crafting with the vagabond, do you use as many hammer as it's required or you only need to have them, and you use only one per craft?

I hope i was clear.