how low can they go?
u can buy right now an xbox with 3 games for $399

Is it a good idea? Yes. Will they do it? probably not. I think MS would like to see how well it'll do this holiday before dropping the price but not doubt about it if they did that it would be a great move for the holidays.

Its already $399.99 with Madden and a game of your choice.

I get they wanna boost sales and yes they have the money to burn but its getting desperate.

I certainly would not expect to see a price cut this year (even of the temporary variety) but if they could swing it I think it would obviously garner interest. I think the more sensible thing will be just to offer an array of appealing deal-oriented bundles and wait for any price cut until next year.

$100 gift cards during black friday along Call of Duty and Halo will put Xbox on top if Sony didn't do a strong offers.

price drops aren't always a good thing.

What MS needs to do is attach as much value as possible to the current SKU and price rather than all out drop the price. First off, being $50 less than the PS4 may not be enough to outsell the PS4. And if that somehow prompts sony to do a price drop of their own then all they would have succeeded in doing is accelerating the uptake of the PS4.

As it stands now, things will be getting pretty expensive for them to in regards of any kinda exclusive marketing or deals. But they need those deals to at least have a fighting chance. If the gap gets wider and faster, then it becomes almost impossible or unreasonable to keep making such deals. Forcing sonys hand into dropping their own price now would thus do more harm to them than any kinda good.

Last year sony did a TLOU+Batman AO PS3 bundle and it sold quite a lot even with next gen in the corner,I expect sony to do something like that for holidays.Plus,they have destiny bundle and probably GTA5 bundle.Add this with Driveclub and little big planet and PS4 will be fine this year.

Considering sales, why would sony do anything? And the whole bundling stuff, as good as that sounds they don't need to when all they would probably do is make such games available on PS+.

Sales could be better. 

1- That was for PS3 which they can easily afford it.

2- They weren't winning as they do now.