What does Google think about paid links?

What does Google think about paid links?

Google engineer Matt Cutts confirmed that links are important to Google in his blog post: "Google (and pretty much every other major search engine) uses hyperlinks to help determine reputation. Links are usually editorial votes given by choice, and link-based analysis has greatly improved the quality of web search."

However, he also stated that "Google does consider buying text links for PageRank purposes to be outside our quality guidelines" and that he "wouldn't be surprised if search engines began to take stronger action against link buying in the near future".

He also revealed further information about what can happen to web sites that sell links: "Reputable sites that sell links won't have their search engine rankings or PageRank penalized–a search for [daily cal] would still return dailycal.org. However, link-selling sites can lose their ability to give reputation".