1. the eurozone is a large economy, much less dependent on trade than individual members are. As I noted, exports to the US are less than 3% of GDP. And, in line with Anglo Disease stories, having a manufacturing sector is likely to be a good thing as the financial sector crashes down;

2. true. But the impact of the Anglo Disease on that point is unclear

3. (hmm.. in what category does he put France...?) Again the eurozone is a large economy. Most of Italy's and Spain's exports go to the rest of the eurozone and thus are not sensitive to outside exchange rates. Sterling moving against the euro has an immediate impact for most of UK's trade.

4. The ECB has clearly chosen a policy which was no closer to German needs than to Spanish or Irish needs in the past (Germany would have required lower rates, Spain higher ones). TIt is a pragmatic institution which is not given enough credit for what it does (see Migeru's comment lower down about its awareness of its political role, and its willingness to intervene to pump liquidity in recent months, without pontificating and then folding)

Britain is far less dependent on manufacturing than some euro-zone states.

Britain is far more dependent on financial speculation and puffery than some Eurozone states. An economy built on funny money CDOs and junk mortgages is clearly in such a strong position at the moment.

ceebs:

sterling is falling aginst the euro and Swiss franc -- to 4 year lows viz euro, so the currency overshoot is not as extreme.

Overshoot? What overshoot? We're talking about a currency which is starting an inflationary spiral and is likely to default on some or all of its obligations within the next 5-10 years.

There is no overshoot here. If anything it's faith-based nonsense like this which is making the dollar dump too cautious.

ceebs:

sterling will fall a lot further, and that will rescue us.

Because that's such good news for an economy based on rickety financial scams which imports almost everything that matters.

ceebs:

UK can and will slash interest rates. Club Med cannot do so until Germany is ready, which it is not...

The UK can't slash interest rates without creating stagflation. A rate fix is another roll-out for the Greenspan put, and we know how well that worked for the US.

Honestly - where do they find these people? He sounds like he has genetic connections to the geniuses at the Treasury who are predicting $20/bl oil.