EDIT: Thanks JJG for demonstrating my point. For the record you've been saying the same thing for a couple months now, and while you might be right in the future, you've been wrong up til now.
Tell me one point in time where it made more sense to buy a 2600USD mining rig (which has costs to operate too!) than to buy 2600 USD worth of bitcoins!
Define the parameters of your purely hypothetical situation. When I buy mining stuff in this scenario what is my outlook? Am I forced to play by the rules you coin buyers typically set for someone buying mining stuff such that they must
sell coins the instant they are mined?
Actually I will set the parameters myself, if you don't like them, too bad for you.
Theoretical mining rig(s): Caseless -- Used 5870 $175 each // 400MHash/sec; Random mobo choice -- MSI 790X-G45 AM3 $90 each new (cheaper used) // 5PCI-E slots; Cheapo 1x PCIE extenders $5 each; Corsair tx950 $150; some crap ram $20; Sempron 140 $40. There is a thread floating around somewhere about how to build a custom wood enclosure for like $30 of wood and nails that houses 5 x 2 cards very nicely.
2x above (5 5870s) = $2400. Use the last $150-$200 for some fans or something, I don't care. Hashing power of system 4GHash/sec, electricity cost estimated @ 1296kWh / month + fans, let's round it out to 1400kWh/month, locale dependent, 11cents / kWh = $154 / month.
So, I can choose any point in time? Let's go with 2/18 - 4/18. Nice 2 month period of time. This is winter time so the cost of cooling will be opening a window and pointing a fan out of it to vent the hot air.
Miner Start: 0 BTC $2600 Debt $2000 Assets; Buyer Start: 2600BTC $2600 Debt $0 Assets
Difficulty 2/16 ~45000, Miner Generates 1300 BTC in 2 weeks.
Difficulty 3/01 ~65000, Miner Generates 900 BTC in 2 weeks.
Difficulty 3/14 ~80000, Miner Generates 700 BTC in 2 weeks.
Difficulty 4/01 ~80000, Miner generates 700 BTC in 2 weeks.
End of 2 month period:
Miner End: 3600 BTC $2900 Debt ~$2000 Assets; Buyer End: 2600BTC $2600 Debt $0 Assets
Bitcoin Value Start $1 / BTC; Bitcoin Value End: $1 / BTC
If they both sold at 4/18:Miner Net profit $700 (excl assets), $2700 (incl assets). Buyer Net profit $0.
Source: MtGox all time value list. Bitcoin.sipa.be network computation graph 8/10 - 6/11, bitcoin mining calculator.
If you continue the trend then the miner continues making more and more coins and as bitcoin value explodes pulls even farther ahead. Because I'm lazy I'm going to extrapolate from 4/16 to 6/1 using the 6/1 difficulty (incredibly unfair to the miner) of 434000 for for the remaining 6 weeks. @ 434000 difficulty miner generates 67.5BTC / wk, or 405 more BTC.
Miner: 4005 BTC $3125 Debt ~2000 Assets; Buyer End: 2600BTC $2600 Debt $0 Assets
Bitcoin Value Start $1 / BTC; Bitcoin Value End: $8.7 / BTC
Miner Net: $31718.5 (excl assets); Buyer Net: $20020
Any time when bitcoins are profitable but not exploding in value mining is a superior cost-benefit.
Again, I'm not arguing that either one is superior, just that I'm sick of fanboys touting one method or the other. No one knows the future
. Stop pretending you do. If you have chosen one or the other that's fine.