Is that a fact or something you chant when you are feeling sad i.e your opinion?

Oh, you answered it in the first quoted line. Sorry to bother you.

you made my day Dengle hahahahahhahah lolol

A 1.5 TFLOP GPU capable of running Unreal Engine 4 no sweat (which is at least a 6 fold increase over the 360) would not mean the system has to be $500+.

A 28 nm GPU in that range w/2GB GDDR5 RAM would probably run Nintendo about $100 at cost. Lets say it's a customized 7850 GPU. 

Then factor in another $50-$60 for the quad-core CPU. $30 for the motherboard. $20-$30 for the disc drive. $30 more for misc parts (flash memory, WiFi, etc.).

I think you could probably it so the $349.99 SKU was sold at cost/slight loss and the $399.99 SKU was sold for a slight profit from day 1.

I honestly think Superchunk may be "more correct" than many people who are highly critical of the Wii U's processing power ...

Consider that the PS2 and PS3 were launched when $1 USD was worth between 100 and 120 yen, and today a dollar is worth closer to 70 yen. If the PS4 duplicated the PS3 strategy and launched today, Sony would (probably) need to sell the PS4 at close to $900. When you factor in Sony's poor financial position it is unlikely that they can afford to continue on the same path with the PS4 that they took with the PS3.

While Nintendo is a conservative company they're not incompetent, and I think that if Nintendo was willing to take similar losses to Sony or Microsoft about the best that could be done is increasing processing power by 50% while keeping the price of the Wii U at its current level. If they were willing to drop the Wii U tablet and use a convention controller they could probably increase processing power by an additiona 50% while maintaining their current cost structure; and if they were willing to add an additional $50 to $100 they may be able to get an additional 50% to 100% processing power increase. Pushing processing power beyond this would likely result in very rapid increases in the sale price of the console; and some of what people are expecting would require a $600+ console.

Both PS4 and 720 will have SKUs for under $500. Book it.

The 360 started at $299.99/$399.99.

The only reason the PS3 was $500-$600 was because of the Blu-Ray drive, unless Sony is shoe horning a mega expensive disc drive format into their next system again, PS4 won't cost that much.

But performance wise, sure a 6-7x leap over the PS3/360 is easy guys. An AMD 7850 GPU (28nm, small ideal for a console casing) obliterates the 360/PS3 and it's not a mega-expensive GPU either. You can pick one up from a store for $170, obviously the mass-produced price a company like Nintendo/Sony/MS could get that GPU for would be far less to boot. 

The CPU/GPU IMO is actually not what makes these systems expensive. Even Iwata said with regards to the 3DS, the price of the chipset drops very quickly once mass production ramps up. What killed them on the 3DS was probably that 3D screen.

Nintendo would have to accept a system more akin in size to the Western NES though to make this work though. But honestly I never understood the obsession with super tiny consoles anyway. I never thought "gee my NES is taking up too much space". As long as the thing isn't the size of a boat, like the original PS3 was, it's fine (PS2 was an OK size too). 

The Radeon 7850 uses 130 Watts which is similar to the PS3 at launch, and this GPU is still (probably) only 2 to 3 times the performance of what Nintendo has (most likely) included in the Wii U.

Beyond that, when the PS3 launched the dollar and euro were worth (roughly) 50% more compared to the yen than they are today and Sony was in a much better financial position and able to absorb greater losses. A system that (in relative terms) they could have launched for $300 in 2006 will probably have to be sold for closer to $450 in 2013/2014; and a system that (in relative terms) they could have launched for $400 in 2006 will probably have to be sold for closer to $600 in 2013/2014.

Doesn't Nintendo have a fair bit of US currency? It would be pretty silly IMO to keep everything in Japanese yen, especially when Japan plays basically no role in the production of these consoles anymore. The GPUs are designed by American companies and then manufactured in China. 

If not, neither Sony or Nintendo can really compete with MS, who presumably has most of their cash in American dollars. MS could go get the higher end GPUs from AMD without worry of whatever the yen costs. Doesn't really affect them. 

If Nintendo had just gone with the pro controller / wiimote combo (sans touchscreen gamepad), and dedicated their energies toward a stronger machine (essentially making the console of my dreams), they wouldn't nearly sell as many units. What the Wii U does is gets people talking, and adds a unique element that the other 2 console manufacturers can't match (at least at the moment). Sales are everything, and creating a full generational leap [visually] would have hindered that. The way they did things is more appealing to the masses, and it's better for business (even though I feel that Wii U is $50 too expensive).

Making the GamePad optional is a terrible idea. That baby is the next generation of controllers, man.

To be completely honest, currency hedging strategies on the scale that companies like Nintendo are involved in is far beyond my understanding ...

With that said, it is not necessarily the actual hardware costs that will be reflected in the increased cost of the systems. For Nintendo and Sony the declining value of the American dollar and Euro will translate into substantially lower licensing fees and software revenues; and Sony/Nintendo will be unable to increase software costs to compensate, and will have to reduce losses/increase revenues from hardware to make up for these lost revenues.