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Everyone Still Rumbling About PS3
To put things in perspective, the Curmudgeon Gamer has created graphs showing inflation-adjusted console costs. The PS3 is far from the most expensive console in history (that would be the Neo Geo, at almost $1000 adjusted price), but that hasn't stopped analysts, publishers, developers, and gamers from grumbling about it the week after E3. ABI Research has publicly stated that Sony may have 'hamstrung' itself with the console's high price. Publishers and developers are worried because (despite Sony's protests to the contrary), developers just don't have the kits to make the games. From the GameDaily article: "'A lot of developers have not gotten the kits,' said Sega of America president Simon Jeffrey while attending E3 last week. 'There certainly will not be a lot of titles available.' The result is that publishers that do want to take part in the PS3 launch will have to release games that don't fully take advantage of the power of the Cell processor, added Jeffrey."
What the hell does inflation-adjusted have to do with consumer electronics? What a completely retarded justification.
The fed actually uses those depreciating prices in consumer electronics in their phoney-baloney inflation index (hedonically adjusted avg). The practice is of course used to help mask their money printing and devaluation of the currency, not to mention avoiding increases in inflation adjusted liability payments. I think the submitter would do well as a fed board governor.
The PS3 is far from the most expensive console in history (that would be the Neo Geo, at almost $1000 adjusted price), but that hasn't stopped analysts, publishers, developers, and gamers from grumbling about it the week after E3.
The market still relies on the dumb "9" prices (199, 149.90, 399, you know the drill).
Of course, we all know paying $600 is not different to $599, but they do it, and we're flooded with such prices, get tired and occasionally fall for it while doing quick comparisons.
And why they do it? Because it works. When you compare prices *fast*, you occasionally forget about the 9-s, such as when comparing XBOX's $399 and Playstation $599.
Noone is actually making a charts with inflation adjusted prices in his head. All it counts, is what first impression the digits makes...
> The practice is of course used to help mask their money printing
Um... Yeah. Except the Federal Reserve doesn't print money. That's the Mint You're thinking of.
Nice job demonstrating the typical lack of actual economic understanding possessed by Gold-Standard Nutters though.
Sitting Walrus Blog
The mint just prints hard currency. The Fed determines the amount of money available. It does this in three ways:
1. The Fed buys and sells government bonds. To reduce the amount of money, it sells bonds. To increase the amount of money, it buys bonds.
2. The Fed determines how much banks need to hold as reserves (the reserve rate). Banks are required to hold a certain percentage of the money they hold in reserve (the rest can be loaned out). If the fed increases this percentage, banks can lend less, reducing the amount of money in the system. If the fed decreases this percentage, banks can lend more, and more money will be in the system.
3. The Fed sets the discount rate. That's the rate which banks pay for loans from the Fed. Banks need to borrow when their reserves go below the reserve rate. If this rate is high, it discourages banks from getting into that situation, thus banks lend less and there is less money in the system. If the rate is low, it has the opposite affect.
Gee, thanks for that wonderfully insightful economics lesson anybody here could have Wikipedia'd themselves.