New Speakers/Amps

Shop the used market here for something local. PSB, Thiel, dynaudio, Kef, vandersteen, all have good "cheap" models.

http://app.audiogon.com/listings/full-range-psb-imagine-t-towers-2013-10-06-speakers-44281-wadsworth-oh

I would skip the sub for now and put the money in speakers or amp/pre.

All in one DAC/pre/amp with great sound.

http://www.wyred4sound.com/webapps/p/74030/117839/612512

If you want a head start toward great sound:

-NAD C 390DD integrated
-KEF LS50 speakers
-Rega Apollo CD player
-B&W ASW650 sub
-Harmonic Technology (or Acoustic Zen) mono crystal wire

Happy Halloween!

Pre owned Nad electronics and Vandersteen latest model 2CE Sig series speakers AQ Cables
Dealer for both over 20 years
JohnnyR

PSB makes some great speakers in your price range. Subs also. You can actually spend less. There are lots of great others too. I've always liked Jolida gear. I'd consider an amp from them if I was looking.

**PSB dealer disclaimer**

If you think you might get more serious about this down the road I agree with the others who said ditch the sub for now and get the best monitors/floorstanders you can afford (some good ones listed above) along with the best NAD integrated you can fit into your budget (used would be a good idea for the amp -- speakers are a little more risky used).

If this is really just for casual and/or background type listening you could save some $$$ and just buy something like this that should be more than fine...

http://www.hsuresearch.com/products/value2pkg.html

Best of luck.