i don't believe it will sell as well as ps4 but at least they assure the us market

I doubt it.

But, it will still have no chance in Japan and europe.

I don't see MS taking a hit on the console for market share, the PS4 value and price advantage is too big for them to make that sacrifice.
I say they give up the DRM policy and that's it, they hold on $499 and just ride the storm out.
Xbox is establish enough for MS to lag behind on market share but still make a decent profit, like Nintendo. No panic price drop in 2014, they don't need to do that, all they had to do was drop DRM, millions sold right there.
If they drop they risk plunging Xbox into the red for most of the gen, and its not worth it.
They lose market share but remain relevant while breaking even on the console. Profit better than market share.

If this were true, then all the posts back in 2006 about how a 360 with wifi adaptor/HDD/HD-DVD drive/Gold was more expensive than a PS3 might have had some sway.  But they didn't.  People care about the price more than added value.

The Wii's book was a new easy to use control scheme paired with broadly compelling software for an affordable price.  Kinect software hasn't exactly been lighting up the charts since the initial salvo, so I'm not sure that is going to convince people to pay $500.

Given Pachter's track record, can we safely assume that in all probability he is wrong?

You forgot to add technically inferior to the PS4.  Only way you say otherwise on this, was the camera being THAT critical to the success of the console.

Also, Pachter is presuming a price cut in his prediction.

If Microsoft deem it important enough, they can afford to be price comparative with PS4.

bull people will not pay 100 more dollars for a weaker console.. sony will stomp ms

So now that DRM is out of the way, here's the next sequence of targets for the usual suspects:

1) Kinect raising the price and no one wants it
- MS adds a Kinect free bundle
2) PS+ offers more value because of the free games
- MS continues to offer free games to XBLG members
3) Sony has more first party and Indie support for the PS4
- MS heavily invested in 1st party ($1 billion!) and introduces a multi-screen Indie platform for X1, W8 and WP8
4) ......... well, Sony has a movie and television studio so their TVTVTV is better
- MS finally stops listening to these selfish clowns and paves it's own future for console gaming

Exclusive games/dlc, brand and marketing make a difference. In the US I can be sure that even 100$ more expensive the xbox has an edge.