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#2 - Google straight up cannot identify a natural link from purchased.
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Exactly.
And link buying can be done stupidly, in which case it would be dangerous.
Common mistakes:
1. Repeating the same anchor text in hundreds of link. Search engines can easily detect anything that isn't unique. So keep it unique by varying the anchor text.
If you're going for "web hosting", for example, you could use dozens of variations: web hosting, affordable web hosting, quaity web hosting, click here for web hosting, etc, etc. Ideally each link should be unique.
2. Site-wide links. I never buy site wide links for link popularity/rankings. When I do buy site wide, I do so for traffic.
3. PR10, PR8, PR9 links - those make me nervous. It smacks of buying PageRank, and that's one way to get on Google's radar.
4. Irrelevant links. Don't go buying links for your office furniture site from a script directory site.
5. Editorial integrity. Say you have a web hosting site, and a webmaster blog is selling links. If that webmaster blog is selling links to viagra sites and debt consolidation sites, don't do it.
6. Going overboard. All things in moderation, including link buying.
7. Bought vs organic as a percentage. I believe that bought links should make up a small part of your overall link profile.