At the PS4 event in New York, Sony showed off the Unreal Engine 4 running on the PS4, as well as the new Havok physics engine. Real time, millions of particles, and state of the art hardware. Have a look.
Many folks don't realize what 8GB of DDR5 can do for gaming. PC Gen is still stuck in 32-bit games with 2GB maximums on 64-bit systems. There are some outliers (X-plane, DCS, sims) but that's what it's been and still is. The PS4 (and presumably the next Xbox) will not have that pseudo-limitation.