Why cut when they need to make money? Let us see how this affects the xbox360 sales before screaming that they are idiots.

Yes it is a games console and the sapce Blu-ray provides, will allow games like MGS4 and KZ2 to be played off one disc instead of around 5 DVD's.

At first Blu-Ray seemed a bad choice because of the huge costs and inflated console cost, but now with Blu-Ray price reductions, it does seem like the sensible choice. 

Well these games might take up all the BD space if they don't use compression at all. And by this logic, 360 won't have any big games like MGS4? Anyway, i don't remember anyone bashing FFVII for being 3 discs.

Even if it's causing the PS3 to be the most expensive console by far, even with a quick price cut?

 The PS3 is only $20 more expensive than the Elite 360...so not exactly by far...yes it is expensive though!

Comparing the most expensive version of the 360 with the cheapest version of the PS3? ...

The fact that even then you get a $20 difference in favor of the 360 should tell you something, especially with the 360 not having a price cut yet.

Well maybe Microsoft thinks the 360 is a joke... I mean that press conference was horrible... Hey guys... remember those exclusives we had for the 360? Ya... they are all going to the PC... so we don't have a reason for you to buy our product anymore. Oh ya... just in case you still want to buy the console... we have the ugliest console ever made to sell you. I mean come on! WTH was that?!?!? And no Price drop... LOL... ok Sony is back in the game... as long as they come out... don't say anything stupid about how they are somehow winning the console sales worldwide BS, then they might be ok. Of couse... Sony could easily drop the ball as bad as MS and it might even itself out...

Sadly... Nintendo is off in it's own world... swimming in Forever Blue.. Someone want to knock on the glass and wake them up for their show this morning?

I think that microsoft is just waiting until their new "falcon" chips start being mass produced so they will have a lower hardware failure rate and cheaper. Once those things get in high gear and they see how well 360 is doing vs PS3 then they will do a price drop. Microsoft is a business and so far they didnt need a price drop and Sony's early price drop is showing to them that Sony is kinda desperate, so if they see a significant increase in PS3 sales they will immediately announce a price drop.

Just a side note, it seems that flipping a coin is once again more reliable than Pachter's predictions.

I think that Microsoft is probably just waiting for September to drop their price, probably around when Halo comes out

Probably after Halo comes out. The expect a boost from Halo... so no reason to drop price until the demand for Halo declines.