Sony FY 2008 Q2 Results – Analysis – SONY BLEEDING – LOOKING BAD

[NJ5]

Squilliam said:
In an economic crisis like this, I wonder if Sony is suffering from substitution of its goods for other inferior brands.

The basic principle of inferior/normal goods is that when the consumers income goes down they tend to buy more inferior goods and when their wealth increases the opposite.

So instead of buying a Sony, someone might instead buy a Sanyo and save a few hundred $$$.

Am I right?

That's obviously one of the potential consequences of an economic downturn. People become much more cost conscious. Instead of buying the top of the line Panasonic or Sony LCD using their 18% interest credit card from a bank which went bankrupt, they buy the el-cheapo Walmart LCD using the pocket change they dug out of the couch (or just keep their old TV which still works fine).