How do you even quantify risk of holding bitcoin?  I mean, it's gotta be near infinite with all the question marks.  Which means any derivative, valued by some means involving Black-Scholes or similar would require the premiums to be gigantic enough to make the derivatives worthless. 

Oh, and the spreads would probably be monstrous too.

Except for one minor problem.  Energy is not free and unlimited for us with our current technologies.  If we had limitless power, sure, absolutely.  Time of scarcity is over.

Until then, you are simply wrong.

Sure it will.  Around the 21st of the month the namecoin difficulty will be a tiny fraction of bitcoin (I estimate 20k or less for namecoin, 3 million for bitcoin).  For a brief, shining moment with all of us dogpiling on namecoin to generate all 2016 blocks in less than 24 hours the BTC difficulty will drop. =)

Instant is what the difficulty would be if the instant's computing power was the average over the timespan of 2016 blocks.  Predicted also looks at previous computing power since the start of the block to guestimate the coming difficulty. 

Instant is higher grained and gives you a better idea of how many many are optimistic or pessimistic right this second.

And yet, it costs around $6 to produce a bitcoin now (hardware ammortization over an expected 3 month lifespan + power).  That's still a healthy profit margin, so I'd say $14 is overpriced today.  $32 when the cost to produce was around $2 was pure insanity.

Both BTC prices and difficulty are still catching up to the results of a $32/BTC bubble.

What really happened is a large amount of people did math at $32/btc, bought piles of hardware and now *need* to sell every bitcoin they produce as soon as they're being produced.  In effect the daily supply increased, since previously a much larger % was hoarded.

That, and it's the weekend effect.  The Ponzi Pyramid will be growing again once people can deposit $ to MtGox tomorrow or the day after.  If you have funds at mtgox $14 is definitely not a bad price point for a 3 day gamble.  Much lower risk than buying hardware and waiting for it to ship.

Why would you do this?  You'd be giving up 20-25% of your computing power.  If you want namecoins then mine bitcoins, exchange them for namecoins -- you get more namecoins for the same computing power per day.  Plus that may nudge the exchange rate in the right direction making your investment more likely to return higher.

That's what those of us not into giving away 25% are doing, and you're welcome.

Look at some of the products on cablesaurus.  He's even got a *pci* to *pcie* adapter, which can then be used with the pcie extenders.  8 total GPUs even on a cheap motherboard is doable.  Also found this: http://www.amfeltec.com/products/flexible-pci-to-pcie-adapter.php

As far as case, $250?  Really?  Just get some aluminum L-angles from home depot for $16/8 feet, $5 for a bag of 100 bolts and nuts and a drill.  Assemble a cage from the L-angles to bolt the cards and optionally PSU to, put the motherboard on a non-static foam pad, use a $12 dual PSU adapter to get a ~1300 watts for less than a quality 1000 watt PSU.

Depends.  A 6950 is still a viable gaming solution, doubly so if you luck out and get shaders unlocked.  It, as a tangible good has a value (well over 50% of the purchase price ATM) to a vastly larger market than bitcoin enthusiasts. 

7 series cards are not going to show up until late fall, so that won't change for ~3 months.  Let's conservatively say the depreciation of a 6950 is $120 over 3 months, for a final ownership cost of $120.  It is possible to recycle a an obsolete PC for the rest of the rig which won't depreciate nearly as much.

Anyway, that is about 8 bitcoins worth of depreciation worst case.  The same 6950 may not return 8 bit coins over the next 3 months adjusted for difficulty jumps and power costs.  I think 6 is a likely estimate (most of that being in the first 6 weeks).

Bitcoins have only the value buyers assign to them.  They could be worth $100/btc by fall, or they could be worth $0.  In other words, investing $ in bitcoin is far riskier, but has a chance for a larger payout over 3 months.

Key point: after next namecoin difficulty.  We're all waiting for that, the only ones mining at the CURRENT difficulty are patsies (and in fact, I have no idea who is mining now and why.)

It's like this.  Current namecoin difficulty:  55883  Current bitcoin difficulty: 1379223.  Dividing bitcoin difficulty by namecoin difficulty gives you .04, which, plus an exchange fee % should be what a namecoin trades at to *BREAK EVEN* with bitcoin. 

In other words, anyone mining namecoins right now as opposed to mining bitcoins and exhanging them forbitcoins is giving away *25 %* of their computing power.  It's just silly.  Most of us realized this, and bailed on namecoin when the difficulty went from 15k to 55k and the price dropped from .07 to .03.

At the moment we're looking at about 1 block/hour network rate on the namecoin network.  In another 905 blocks (or about a month if people keep mining at a loss, possibly longer) is when the difficulty will drop to about 5k or so.  *THAT* is when it will be profitable to mine namecoin, not before. 

TL;DR nice try.

Not hard at all.  Modern hardware supports ACPI RTC alarms to wake the hardware up.   MythTV DVRs use this functionality to wake up right before a show needs recording, then go right back to sleep.  Between RTC support and cron you could implement exactly what you described, modulo hardware failures or brownouts.

As far as remote access, just ssh in.  That's what I do.  ssh -X, x11vnc and it's just like being there on the keyboard.

Now the last poster's pricing structure makes a bit more sense.  Call it $300 a month to get a gigahash * 8 months.  $2400.  Assuming difficulty does not go up from 1.3M (and it will, in just a few more days) you'd be getting 185 bit coins for that $2400. 

That's a discount of about $400 from current market price -- a daring person might take the bet of difficulty falling while $ value of BTC staying constant or increasing over those 8 months.

A less daring person would simply buy a ~$1000 worth of parts to produce the same 1Ghash, budget $600 power over the same time frame, buy $300 worth of beer and take the last $500 and bet it on poker games.  And at the end of the 8 months sell the hardware and buy another $500 worth of beer.

The OP's pricing structure, however, is just 

The first cat or small child to come along would destroy your mining operation.

I'm experimenting with 3/4" x 3/4" x 1/8" aluminum angle stock from Lowes.  8 feet of the stuff is about 15 bucks + tax.  The pieces can be easily bolted/riveted/tied together to make a cage of your desired dimensions. If it pans out I can order 24 foot segments (shipping is murder for small quantities) and mass manufacture 4 and 8 card cage kits to sell for bitcoins.

 I'm experimenting with screwing the cards down on one end of the 'cage' and just letting them rest on a bit of padding on the back end.  Biggest danger so far is PCIe extenders falling off the cards, followed closely by cards ingesting cat hair.

Actually, Linux was quite usable in 93.  By then you had Slackware, which was an easy enough "distribution" of a functional Linux OS, complete with network stack and X11.  You no longer had to roll your own /bin/login, you could actually use Linux for developing POSIX code, for the most part -- and I did.  Ditched Interactive Unix for it, even.

Very much like bitcoin.  Sure, you can't order a pizza from Dominos and pay in bitcoin today.  But you can use it to send money around the world, today.  You can use it to get some goods and services, today.  You can even exchange it for more established currencies.

Now Linux in 92 - that was probably like Namecoin today. 

There are a lot of pools.  Problem is, there is little reason to NOT use one of the biggest pools.

The top 3 all have something to recommend themselves.  BTCguild can be low fee.  slush is for those who like the luck aspect of bitcoining.  And deepbit just works and works well (less than 1% rejects for me compared to 5%+ in other pools, e.g.).

The new pools just have a rough time getting off the ground.  Except for multipool there are no advantages to any of the newcomers, and nothing but disadvantages.  You could get a block from hell which takes 3 weeks to mine in a small pool.  The operator may just say screwit and take all the earnings since they don't see a future in running their pool.  And so on and so forth.

Now, if there were clear and obvious advantages to either solo mining or mining in a smaller pool we wouldn't have this centralization of power we see in our "distributed" network.  At the moment the network consists of basically 3 nodes.

Problem is, at the current hash rate (still dropping) on the netcoin network it'll take at least a month until a difficulty adjustment down.  During those times BTC difficulty (and $ cost?) will probably continue going up, so your .02/nmc could look like buying at the top in a week or three.

In other words, NMC is currently INflating due to an anticipated fall in difficulty and BTC is DEflating.  Double whammy against NMC.

And that's what people figured out a few days ago and started the dump at .05 down to .02 right now, and still falling.

Looking at what happened to namecoin got me thinking about long term future of bitcoin.

The premise of bitcoin is it's worth mining even when there's nearly no profit in it because the win comes from hoarding most of your product and selling just enough to cover expenses.  Miners bank on rising difficulty and bitcoin deflation, in other words.

The exact opposite happened to namecoin.  As it became vastly more profitable to mine namecoins than buy them the amount of hashing power in that network grew by 400% overnight.  Difficulty went from 15k to 55k in about 2 days.  At that point it was no longer advantageous to mine namecoins, but the added risk remained so everyone shifted back to BTC.  The hashing power fell right back to what it was a week ago, and at the moment namecoin network is slogging along with about a 1 block/hour rate.  Difficulty should adjust down in about 3-4 more weeks at this rate.

Could that happen to bitcoins?  At some point it would be advantageous to turn off your rig for a month or two and let the patsies mine at $1/day.  Then the difficulty plunges, everyone dogpiles on and makes two weeks worth of coins in a day or two.  Turns off rigs, lets patsies mine for a month+... Repeat.

Could be a fun alternative to an 8 million difficulty and $100 btc price.

Two difficulty rises later, we're up to, using a 800 watt (remember PSUs are not 100% efficient) overclocked quad 5830 setup:

280 Mhash * 4 = 1120 Mhash = .817 BTC/day (in actuality lower, since solo mining is impractical and pools are not 100% efficient)

800 watts * 24 hours = 19.2Kw/day

19.2Kw/day * $.14 Kw/hr = $2.688/day.

So what we have is $2.688 / .817 = $3.29 per bit coin without factoring in cooling, cost of hardware, etc etc.  Another way to look at it,

$17.50 - $3.29 * .817 = $11.6 daily return on a ~$900 investment.  Yuck!

It would also be nice if exchanges pick up namecoins as well as BTC.  Hear that, TradeHill?  Add namecoins to the list of currencies you deal with, should be pretty easy using your BTC code.

Still showing as no credit for any work starting with block 989.  I guess you're welcome to the 15 or so 5830-hours as an unexpected donation -- hope it's the pool op who got the bonus instead of a random person. It's been a great pool until then.

Also confirming I'm getting way fewer connection/stale issues at deepbit with the phoenix miner.  Very short and very occasional miner idles, and actual credit for work done. 

No, I was definitely mining that entire time.  Like the OP I stopped getting payouts completely as of a block several before the problem block, and got 0 shares credited from then on out.