Today, the FT's Wolfgang Münchau published a commentary entitled "Down and out for the long term in Germany".
His central thesis: Deficit countries (US, UK, Spain) will reach a balanced current account in the near future, or possibly turn into surplus countries. This means that surplus countries (Germany, Japan and China) will be forced to reduce their current account surplus to zero or even slide into negative territory.
How will this happen? According to Münchau, there will be a "violent increase in the euro's exchange rate against the US dollar and possibly the pound and other free-floating currencies". For Germany, "this will not end well".
I'm not sure I can follow him here: Yes, Germany's current account surplus has fallen dramatically over the last 6 months, and will probably drop further. However, it is not clear that it will evaporate completely or even turn negative. It may, but it also may not. Even Münchau seems to think that this will only happen due to "violent exchange-rate movements". But is it really inevitable that the dollar and the pound will collapse? Why would they do so? Aren't they already far below PPP by all conventional measures?
Germany has experienced a lot of economic pain over the last 6 months (as has Japan), with GDP dropping much more than in the US. Much of this has yet to register for private households, as employment has barely dropped so far. It will certainly be exceedingly hard to make up that lost ground in the forseeable future. But I fail to see why there needs to be a further dramatic contraction in the near future that will hit specifically Germany due to a much higher euro exchange-rate.