If the Scorpio is too powerful for $399, what does that mean for PS5?

[Intrinsic]

Yes. It will be significantly more powerful that the scorpio. Even when hitting th $399 price point.

And its all about the timing.

TLDR: Being more powerful has more to do with timing than to do with the amount of money spent. And because of how technology systems shift and the fact that every massive computing jump is based on the availability of a new manufacturing process and also that these new fab processes comes around once every 3-4yrs now; you can literally predict what will be what at the time you are trying to do something.

Think of it this way, if the Scorpio releases at the end of this year and by January 2018 there is some sort of breakthrough and 7nm fabrication is available and sony decides to make a PS5 next year.... with a target price of $400 sony would be able to make a machine thats around 4-5 times more powerful than the Scorpio. Crazy isn't it?

And of course, don't forget that sony's expertise is in hardware manufacturing and engineering. Just look at the launch PS4 and launch XB1. And remember that the launch XB1 stll came with an external PSU.