"(spanish and french housing bubble) deflates. that will slow their growth,"  

I don't know about Spain, but I still don't see how the french housing buble deflating will have major effect: french cannot use their house as ATM, construction jobs are not as big as in the US, fixed rate loan are still the overwhelming majority and were taken in a very low fixed rate context (okay they're longer maturity than previous decades but that's about it).

I'd appreciate any insight you have on the french situation.

Thanks for this great post!