That's why Sony and Microsoft are stagnating, while Nintendo is doing better than ever by branching out from the typical video game market. If you make something truly innovative and appealing, people will buy it.

I'll agree with those who said that the entertainment industry typically fares well in these situations.

Additionally, there's no proof that this hasn't affected the industry. It could be one of the reasons why the DS and Wii, with their lower price tags compared to the competition, have fared better than the competition.

There is no recession, the economy just isn't growing as quickly as it did a few years ago. Unemployment is still very low compared to a few years ago though, but people still complain 'cause it's gone up a few tenths of a percentage point. In short, don't listen to what the mass media tells you, they like to shout doom and gloom stories especially when they can use it to cast the current administration in a bad light for no reason.

Depression, Recession, (hyper)inflation or even stagflation is potentially what the US ecconomy may be heading into; and all of these things basically boil down to people having less money to spend.

The reason why many forms of inexpensive entertainment thrive in ecconomic downturns is that recreation and entertainment are necessities even though people often view them as luxuries; the human mind and body need a certain ammount of 'rest' and 'relaxation' in order to prevent burn out or serious damage.

Videogame systems and videogames (even the uber expensive ones) are very cheap in comparison to other forms of recreation; for the cost of a family ski-trip you can buy a Wii with several controllers and rent games for nearly a year, and for the cost of a weekend getaway you can buy a PS3/XBox 360 and several games.