The numbers are all 100% real except for the ones that I specifically pointed out are plain wrong. The others are as much speculation as you are railing against in the same sentence, it makes no sense to create a projection of future trends almost a full year into the future then say "anyone who doesn't sell within the first second is speculating and therefore operating incorrectly." No one knows the future, everything is a speculation, trading is a different beast from mining, but that doesn't mean there is not some overlap.

Are your numbers conservative? In what way? You're assuming a 60% constant increase in difficulty because in the past few months there has been ~60% difficulty increase on each update. This totally ignores the > 1 year in which the difficulty barely increased at all. But anyway, if you are only going to look at the very recent past in which difficulty spiked like crazy, why are you then conveniently assuming a 10% increase in bitcoin value? In the past 2 months the value has gone from $0.89USD to $8.603USD, that is a 10x increase. Yet you choose to suggest only a fraction of that increase. Your numbers are basically tweaked to support your argument as I said, whether or not you call them conservative.

One last corollary, when I said investment I should have been more clear, I was referring to investment in bitcoins directly, rather than investment in hardware. It is clear that there needs to be a promotion into the bitcoin market, to encourage the adoption of bitcoin when people see that there is real interest in it, rather than in just making a profit off it. My apologies for not being clearer there.

Your response would make sense if this was merely a post saying "You should be careful as mining is not a money machine" (as you put it) "here is why it is a risk". It does not, it clearly says you "will never pay off your rig" and "you will lose money" in no uncertain terms. Here is the very first line of this post after stating the theoretical rig specifications:
The rest is cloaked in numerical analysis which is the exact opposite of what you are trying to claim here. Seem to have contradicted yourself. I also stated that I was merely going to be picking on those points at the start, not that it was the utter defeat of the argument. Sloppy assumptions lead to faulty conclusions, rigor isn't an optional thing in an "analysis".

The concept of delayed payments vs accrued interest is laughable? Good luck to you in the real world then. If there is a significant gain to be made from sitting on a commodity rather than instantly liquidating it then you need to take that into account. To think any other way would be as you put it, laughable.

I said it before, but I'll say it again:

http://www.youtube.com/watch?v=2R0oECCuN6I

Grats to CydeWild btw for winning his bet, who woulda thought?

Default 6950 is actually 800Mhz core, so he is adding 20% on top of the default freq, with the unlocked shaders.

Anyway, you need to look at the date when those entries were added, most were 3/11, the newer miners got a significant hashing boost with newer routines. Outdated entries are outdated. My 6950 unlocked at stock clocks got about 350-360MHash/sec after using the updated hashing routines.

This again... I'm going to pick on a few things to start with:

"sometime soon the bitcoin reward will halve", yeah if you consider 2013 soon.
"$2.02 per day (700w @ .12/kWh" -- 3 5850s use absolutely nowhere near 700w. 3OCd 5870s use about 600W from the wall, 3 5850s will use closer 500W or less.
"You will start losing money on day xx" -- You stop mining when it is no longer profitable, no one put a gun to your head to keep going. You can also cash out of your rig if you really don't think you'll ever mine again and have no use for it, recouping even 60% of your initial investment (a VERY conservative estimate if you drop out 90/160 days after building) puts your profit back up > $1000. Not everyone is trying to replace their job with mining, that is a hefty ROI. Find a traditional investment schema that can offer 70 - 100% returns?

As has been mentioned no one needs to cash out immediately, power bills are delayed by 30 days, the minimum time for a forced cash out (or I suppose when the CC bill comes in, however if you purchase on the cusp of your billing date you have 30 days before the account closes, then 30 days to pay, so a 60 day window before any interest accrues on that bill).

Again, I'm not encouraging people to build mining rigs, I agree that the profit is really not there anymore, but your numbers are as flawed in this thread as they were in the previous one I responded to, skewed only to support your assertion that other people stay away, which I feel is somewhat disingenuous at worst, sloppy at best. A better analysis would be why investment and encouraging further investment will yield longer term gains, but that is a lot trickier I suppose.

I don't know what the MHash/W is for a 4850 but I imagine it's pretty low. The 5xxx series seems to be where it is at for mining right now, other cards might be forced to drop out.

I'm not entirely clear on how much bandwidth mining really needs, as it seems lots of people report nearly full MHash out of x1 slots, so if you could find something that was 16x more price efficient (4x double slot PCI-E lanes for 1/4 price) that'd be a very intriguing find. Not sure where the price point is for it being worthwhile, but I'd say that's pretty close there.

Misuse of the term exponential aside, I'm not sure where you are getting your numbers from. I have a limited data set to work from but the previous difficulty changes have been: 79000 -> 101500 -> 157000 -> 244000 -> 435000 (estimated). Somewhere in there has been a huge flood of media attention, a large computer enthusiast forum hopping on, etc. and it's held to about 50-60% increase for difficulty/hashrate. Even assuming that this trend continues at 60% increase in difficulty every 10 days in 40 days it will yield a difficulty of about 2850816, and a hash rate of 23THash/sec (which I'd find a surprise). Even a meager 1 GPU rig of 400MHash/sec will still generate an estimated $25/wk @ $25/coin, far far far far above the cost of electricity. Even at the next 60% difficulty increase to 4561305 this same machine would generate roughly $16/wk.
Now if rates stayed stagnant @ $8.5/coin while difficulty increased > 10fold then yes, you have a point that existing mining machinery would no longer be profitable, but if that were the case I can hardly imagine such a continued pressure to add computing power to the pool.

I'm not saying that someone is still ok buying a dedicated rig, it's become much more of a PITA and profits are hard to be found, just saying that you are making bold statements that I'm not sure the source of.

For those wondering about whether or not to build a mining rig at this moment, I'd advise extreme caution. All number crunching aside there is currently a large collection of people with $ signs in their eyes overbuying that you will be competing with entering the market, while we don't necessarily see the same headlong rush of investors into the bitcoin market. People with a real need to sell (to recoup costs) without an equivalent need to buy doesn't forecast well for offsetting the diminished returns that are already in the pipeline. This is why you will see so many people promoting the investment in bitcoins rather than mining hardware, both because it will be more profitable for them personally, as well as that it is the only way to keep the system running.

wow @ the guy with 250,000 bitcoins. well done sir.

427,000 with 177 blocks left to go, this is fun. I'm betting cyde will win but it will be close either way

Uh, your PSU is 91% efficient at 90+% load? Nuh uh.

If you see 690 watts at the wall it is much more likely that you have 600Watts to the system or less. I still haven't had time to take my rigs down and swap my meter over to a triple 5870 system, but my 2x 5870 + 1x 5850 system is eating 555W from the wall on a 80+ gold 650, so probably like 480W delivered. Make sure to downclock your memory

There was a funny ebay post someone put up (here? cant remember) where a guy claimed to be the one who was doing that on craigslist, and he was selling a broken 5870 for $250 just because it had been "touched by him". Haha. See if you can track that down, might find your man.

Buying 5870s new is probably a bad idea. The price is very high for their performance. Expect about 400MHash/sec OC'd vs. maybe 285Mhash/sec for a 5830 OCd, then compare the price of ~$100 USD/CDN vs the proposed $290

Obviously you have to screw the card into something, or lay it on something, or support it in some way shape or form. An extender for PCIE is just like an extender for anything else. It simply frees you from the confines of shoving cards directly into PCIE slots in the way the motherboard is laid out.

If for example you had a motherboard with 2 PCI-E slots that were stupidly placed right next to each other (meaning 2 2-slot cards would be impossible to fit) you could use an extender for the second PCI-E slot and simply screw the card in a few slots farther down on your case. Or build a custom case. The sky is the limit.

You can run any 5870 with any other 5870 in crossfire, however mixing VRAM will sync the VRAM quantities (and since you can't sync up, that means you can only sync down).

From a mining perspective it doesn't matter at all.

3 5870s on a sempron system with a single hard drive and a buncha fans use less than 600Watts while mining with the memory clocks turned down. Potentially under 500Watts but I don't have equipment sophisticated enough to fully test that yet so I wouldn't recommend it. A quality 650Watt PSU is all you need. 850 could run 4 or potentially more 5870s.

I'm glad I didn't post in here before. When I first read this thread i was all "clyde is a sucka, just givin his money away". Now I stand humbled eating all kinds of nasty crow pie. The difficulty jump is still 500 blocks away, which I believe is 2 days give or take, but it's already coming right on up on his numbers, well done man, if you win the bet you deserve the monies

P.S. @ 400k+ difficulty (> 70% inc)

http://www.youtube.com/watch?v=2R0oECCuN6I

I'm sorry wha, they carry the country in productive output? As in the 5% of people you claim are paying all the taxes are also producing everything? As in they themselves are producing it? Or they are the ones with the capital to finance paying other people to produce the machinery and create the infrastructure that will then be used by the rest of the country to produce things? Pretty fine distinction between the two.

Can you define contribution? If a poor person works 8 hours a day producing X numbers of widget A for a rich person, he is inherently profitable or he would be fired. He has thus generated both a useful good for society and a profit for a rich person. So far he sounds pretty productive and contributing.
Now the poor person goes home after buying some gas from Corporation W, eats the food his wife shopped for at Store Y, and watches the TV he bought at Store Z.
At the end of the year after he has paid all his taxes, rent, insurance, bought all his clothes and food and cars, electronics, gas, etc. he finds he has 0 physical dollars (though he owns some property).
Thus 100% of his "pay" has returned to the system through both taxes and purchases, as well as creating goods for society and generating profit for a rich person. That sounds like he has contributed a lot to me, although the tax portion itself might not be that large, he has literally given more than everything back.

Meanwhile the rich person has used their capital to create more wealth for themselves, paid 15% (oh right, capital gains taxes, not income taxes!) on it, merely transferred the poor person(s) production to society and likely not bought much more than the poor person (excepting perhaps a few luxuries which slush money around a much smaller more monied pool).

That is a very specific and non-extensible example obviously, but it makes clear how ridiculous it is to tout numbers like income taxes, but if you insist:

2009 US Federal Budget -- $1.21 trillion - Individual income tax
                                    $949.4 billion - Social Security and other payroll taxes
                                    $339.2 billion - Corporate income tax
                                    $172.2 billion -- Misc lumped taxes

Even if we ignore the fact that rich people do not make most of their money from income, but rather from capital gains...

Income taxes make up less than half the budget yet it is 100% of the focus of people crying foul for poor rich people paying out. Hey look payroll taxes make up almost as much as individual income taxes, obviously the rich must pay most of that too right? Except that the payroll tax is capped on the first $100,000 of your income. So if you made 50,000,000 dollars last year, you paid taxes on $100,000 for social security. Suddenly rich people don't seem like they're paying as much tax when half of what goes to the govt is mostly subsidized by the middle class.

Blah blah blah. Anyway, I don't really want to get too into this (I'm not going to bring up state and local/sales taxes), but these juvenile statesments about how we should all be on our knees sucking off the rich because they're our saviors are really ridiculous, and it needs some saying so.

Ha, best description ever. All the replies post this were just people talking to hear themselves.
Though I disagree with the buying coins bit, excepting that it helps grow the bitcoin pool o' cash which will help keep it alive.

Probably neither, looks more like declining interest in bitcoins. I see thousands of coins for sale still, but they're at ridiculous prices (perhaps people expecting prices to follow difficulty) while there are only hundreds of buy orders, at prices far below what people are asking.

What this spells for the future I can't predict obviously, but seems like people were betting on continuing influx of people and money and increase in prices to match increasing difficulty, and they may find themselves in for a rude awakening. Hopefully it won't lead to anything too disastrous.