1. If a miner was more profitable than the price payed, wouldn't the mining companies use them instead of selling them?
2. If a cloud miner was more profitable than the price payed, wouldn't the mining companies use them instead of renting them?
3. Isn't it less risky to buy the coins upfront and not compete with the rising hashrate and diminishing returns?
In my opinion, there is an influx of math-deficient kids and young adults spending money to buy miners in hopes of getting rich. This causes an influx of miners and less buying pressure on the actual market. In time, this influx should slow down as the general group will realize the futility of buying miners, and thus the price will begin to rise again.
Am I missing something as to the advantage of mining?
1. If the miner cost them $600 to make and they can sell it for $1,200 immediately, they mostly would rather make the immediate profit instead of taking a risk, although many of them also mine.
2. If you have to remember immediate profit vs risk of increasing difficulties
3. Usually, yes. There are many exceptions though. Such as an early BFL jalapeno was super profitable, same with an early Antminer S1 (especially overclocked) and a few other miners (Neptune? I don't remember) were super profitable for a long time.\
I personally stopped buying miner and I now just buy BTC directly due to hashrates increasing too fast and not getting a > 100% ROI