Quote from: Keyser Soze on August 31, 2013, 07:52:28 AM

Quote from: bcp19 on August 31, 2013, 12:22:31 AM

You guys spout the "buy BTC instead of buying equipment" jingle over and over, yet the people(horses) reading you won't take heed (drink) just cause it is the proper thing to do.

Buying the mining equipment does 2 things, it gives you a tangible asset that you can see working on your pool charts and it gives you a non-liquid asset. BTC can be spent on a whim, a sudden drop in value can cause panic selling and a quick rise can cause profit-taking or a buy-in hoping it will rise higher. Last April, how many people happily sold at $50 only to buy back in at $100 or $150 or $200? How few actually were actually able to sell at $250? Fiat is something tangible people can understand well. BTC is like play money. I can remember trips to Hong Kong (where their unit is also dollars), but it was around $8HK to $1US. I saw people who would never consider spending $100US on something tossing out $800HK like it was a ten or twenty. They viewed it as play money and got burnt.

That is the perception of a lot of miners... BTC is just a medium to get fiat. Without the necessary discipline to put it away and ignore it, all the advice in the world matters not.

I have never said "buy BTC instead of buying equipment", that was never my argument. I am sure we can agree that people are not always rational and do not always make the best choices.

There are various reasons why people may mine at a loss, but those reasons should not take precedent if your goal is profit. If your main goal is to make a profit mining then your estimated bitcoins earned better be greater then what your mining equipment cost (in bitcoin). Of course you will also want to factor in operating expenses, time value of money, ect.

If miners estimate they will take a loss from mining operations and still buy the equipment, then profit is not their primary goal or they are not acting rationally. Just because it may be the perception of many miners does not mean it is a wise decision.

Ah, no, you did not... "If you produce less bitcoins (in the life of the miner) then the miner cost (in bitcoins), then mining activities has created a loss " <-- Most of the time when people start using this argument, they also say that it would be better to spend that money on BTC and save it than purchacing the mining equipment as you'd have more money in the long run. That is why I used the horse and water analogy... if a person can buy and wait they should and would be ahead, but not everyone can.