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The article explains how the German retail sales decreased by 0.9 percent in July, as a result of the increasing fuel prices.  The inflated prices of fuel have caused the consumption on other goods and services of households in Germany to decrease. Consumption is one of the four factors that affects the aggregate demand or the total demand for final goods and services in an economy at a given time and price level, in an economy. Therefore, if consumption of households decreases the aggregate demand in an economy also decreases. Hence, the aggregate demand in Germany's economy has decreased significantly and therefore their retail sales have also decreased, by 0.9 percent as the article claims. This is because if consumption is lower than the units of output sold are also lower. 

The article describes how unemployment in Argentina has dropped below 7% for the first time in a long time. The decreased unemployment is due to an increase in the country's exports and an increase in national aggregate demand. Both of these things would cause an increase in aggregate supply, which in result would increase the aggregate supply of labor, causing the unemployment rate to decrease. However, this is only seen as a short term change, as the export are expected to decrease due to the economic crisis in Europe, and the increasing movement of production to china, and the growing competition from Chinese produced goods, because of the cheaper prices. This would cause aggregate demand in Argentina to decrease, which would cause a response from the short run aggregate supply, in the form or a decrease. This would again cause the aggregate supply of labor to fall back down again, resulting in the unemployment rate rising again.

Iceland has been in a serious recession with great inflation rates for several years. To control the situation, the Central bank has started to raise interest rates with the hope to decrease inflation and bring prices back to normal levels. By increasing interest rates consumers will stop borrowing as much money which will cause a decrease in consumption. In addition it will become more expensive for firms to borrow money for their investments and they will decrease investments well. Overall these two factors will cause a decrease in aggregate demand in Iceland. This will push down prices and cause disinflation in the long run. Due to these decreasing prices goods and services from Iceland become more attractive to foreign consumers causing an increase in exports which may strengthen the currency. The article states that due to the increased interest rates inflation remained stable for the past months. This shows that households and firms are consuming/investing less which stops further inflation.

The article discusses that the US may face a fiscal cliff in order to reduce the large deficit that has accumulated in the past. A fiscal policy stands for a series of major tax increases and government spending cuts if Congress does not act. The article discusses that through lower government spending and higher taxes it is expected that $600 billion can be extracted from the economy to decrease the debt. However economists think that every dollar of deficit reduction will subtract the same or a greater amount from economic growth. In theoretical terms this would make sense. If government spending decrease this reduces aggregate demand in the economy and by that will cause a decrease in real GDP. Households will cut back on purchases and especially households that are dependent on government support through unemployment benefits will suffer from the policy. Although this will decrease the deficit of the US it may be that it distracts the fragile recovering economy. 

According to this article, Germany's unemployment had increased for a fifth month in august. The unemployment rate is currently at 6.8%. This increase in unemployment was a consequence of the European debt crisis, which had severely decreased demand for exports, causing companies to hold back on investments.  These two factors have therefore decreased both aggregate demand (net exports decrease) and aggregate supply (decrease in investments). Therefore fewer jobs are required as less output is being demanded. This is shown by the numerous job cuts which have occurred throughout Germany. "Siemens AG (SIE) said on Aug. 27 it will cut 500 jobs at its German factories making industrial gear boxes and clutches by 2016, citing slack demand".   However, the article states that the unemployment rate is still the lowest it has been for the past two decades, and meanwhile wages are rising. This increase in wages is boosting consumer spending, therefore causing an increase in aggregate demand, which should eventually allow for aggregate supply to increase, and therefore increasing the need for workers.  Moreover, although unemployment has risen in Germany, it still does not yet compare to the 8.2% unemployment of the US, the 10.8% in Italy, and the euro-area average of 11.2%. 

This article talks about how South Korea's inflation is at its lowest in 12 years at 1.2 per cent. This has both positive and negative effects. It is positive because price level is only slightly increasing, which is good for consumers withing South Korea. However it also has many negative effects. Because inflation is so low employment and real GDP will only be slightly increasing, these are elements that are good for the economy when they increase. One of the main reasons why the inflation is so low is because exports, a key section of the country's economy, have decreased. If exports continue to decrease then this could result in a decrease of GDP in the country which is not good for people living in the country and the country's economy. However, the article says that it is unlikely that South Korea will experience deflation and that this is likely the trough for inflation, meaning inflation is due to increase.

Unemployment is Greece has reached its highest point, 23.1% from only 8% before the economic crisis two years ago. 672,000 out of 800,000 registered unemployed people are not receiving any unemployment benefits and therefore have no income at all. This means there is a huge number of people who are not able purchase goods and services so the overall consumption is decreasing. Unemployment is costing Greece about five billion per year. Minimum wages have also been cut by 23% which are increasing the costs for the government.  This had led to an $81 billion decrease in consumption and the shutting down of thousands of businesses which means the aggregate demand curve has shifted to the left, decreasing consumption in the country. The economy in Greece has shrunk by 7%, meaning it is in recession. 

The article discusses the increasing level of unemployment in Spain hitting record levels. Currently around 5.7 million Spanish are out of work. Traditionally this number decreased during the second quarter of the year during the tourist season however this year unemployment rose to 24.6% during that time. 53% of the unemployed are under 25. This may have great effects in the future once Spain's economy recovers. The younger generation will want to take over jobs of the older generation. However due to the lack of training they may not have the skills required. The amount of jobs has decreased so much that almost half of the unemployed have been out of work for more than a year. This is largely due to a cut in government, regional and municipal spending that has decreased the number of workers in the public sector by 5% in the past year. Because the number of unemployed is so high and is constantly increasing the government had to cut their unemployment benefits leaving only around 40% in certain areas receiving unemployment benefits. The reason causing the high unemployment is the recession that Spain is currently in. In the future crime rates may increase in Spain as many households have no income and are losing their unemployment benefits from the government. 

Although fuel costs throughout the UK are rising, UK's inflation has fallen to 2.5% in September from 2.6% in August. It is expected that the rising costs for fuel would cause firms to increase prices as their costs of production are increasing, resulting in cost-push inflation. Instead, lower prices for clothes, furniture, and household services have offset the increase in fuel costs. Furthermore, this decline in costs of food, clothes, and household good has eased the rise in travel fares.  This significant decrease in prices for foods, clothes, and household goods was caused by an incredible decrease in consumer demand during the recession in the UK.    

India's inflation rate rose to 7.55% in August, rise that was much faster than expected by analysts. The primary reason behind this is a rise in India's food prices. In order to decrease inflation and lower prices, the Reserve Bank of India tried to raise interest rates. This should cause a decrease in consumption and demand. Thus in the long-run, disinflation will occur as firms will be forced to lower prices in order to maintain a profit. However, altering interest rates has been tricky for central policy-makers as India imports a large quantity of their food from the US, who ultimately have control the prices.  The US will probably add to India's inflation as they are "likely to push up global commodity prices".  Even through raising interest rates, which can be damaging as they hurt businesses and consumer confidence, India still has little control over global prices. As a result, India's inflation will raise even. 

Currently the economic growth forecast of South Africa isn't looking as promising as thought, while  additionally its budget deficit is going to be higher than promised. 4.8 percent of GDP instead of 4.6 percent. According to the president, Gordhan, this is due to slower economic growth and not due to increase in government spending. He emphasizes that there will be no increase in government spending. From a neoclassical side this is a good thing as an increase in spending accompanied by a decrease in taxes will only further increase the governments budget deficit. The mining strikes ongoing in South Africa have had two significant consequences. 1. more people have become unemployed due to the strikes for higher wages.2. Offshore investors are worried that the government will increase spending to ease the social tensions. As a result both decreases AD as there is less consumption and investment. 

One of the factors affecting aggregate demand is a country's net exports. Ceteris paribus, as price levels in a country fall, goods and services produced in that country become more attractive to foreign consumers. Some countries have no choice but to import items that they cannot produce. This is another reason for countries to import goods. In this case, the UAE is importing a variety of products from France, ranging from heavy equipment to consumer goods, particularly luxury goods. This article states that France's exports to the UAE are expected to grow 3% this year in comparison with 2011. Therefore, an increase in net exports is anticipated. A result of this could be that the aggregate demand of France will increase. At the same time, the UAE is importing more, so its net exports are decreasing. Hence, its aggregate demand will decrease.

Indonesia has been experiencing rapid economic growth which has increased the size of the middle class as well as their disposable incomes. The article describes how an increase in required down-payments on cars and houses may decrease the growth in Indonesia's economy. Last year the automotive finance growth of banks was 55%, the highest in the world. They have noticed that this is an unsustainable rate of growth. Due to these fears the Indonesian central bank has placed new regulations which will make buyers pay higher down-payments when making a purchase on credit. These down-payments have been increased from originally 10-20% to 30% and more. With that households see themselves with less money available for consumption. The new regulations may also result in a dip in property sales as aggregate demand decreases. However on the other side it may also only defer sales, since people will safe longer until they buy property. 

Ireland's high current unemployment rate of 14.9 percent is a result from its economic situation : Ireland is in a recession. The article clearly stipulates this, there is a 'recession in the real domestic economy'. The recession arose from the housing bubble : mortgages were cheap, people overborrowed and then the high housing prices fell so that people were less wealthy and no longer able to pay their mortgages. Wealth is a determinant of AD. It is the added value of all assets or stocks. If wealth or perceived wealth increases, then so will a household's consumption of goods, thereby shifting demand, as the household feels 'wealthier' or able to purchase more. The reverse is also the case, when wealth declines, demand declines, such as in Ireland. The Irish were much less willing to consume goods, as they believed they were less wealthy or had less money( which they eventually did , upon having to pay mortgages; debt), and so consumption decreased, which thus shifted aggregate demand into a demand slide recession. This is a situation where prices in a nation inflate and output decreases, due to the lesser demand. If less is being produced, less factors of production are required. Thus labor, a major factor of production is no longer required in the economy, which gives firms the incentive to lay off many of their workers. This is the unemployment Ireland is experiencing. It is interesting that the article also depicts the  'austerity drive'  that the Irish government resulted to in the recession.  As it correctly suggests, this is 'self defeating', as during a demand slide recession the Keynesian policy follows that the government should not save its funding, but rather spend. In a time of recession, the government should spend,  so as to decrease unemployment stimulate the economy. If the government spends, this will have a multiplier effect through the economy, as it provides income to households ( by spending, the government employs labor), where househo

The article is concerned with the current economic situation in Ireland, namely a recession. This is a period of decline in an economy, where in the business cycle it is known as a 'trough'. This is illustrated well in the article through the decline of demand in the housing market, as a decrease demand is a typical characteristic of a recession. The overall demand or aggregate demand of a country decreases during a recession, as seen in the Irish housing market, as people have lost confidence in the economy, uncertainty has gone up and unemployment has increased. Consequently people save their money as the situation is unstable and they are unsure of their furture imployment and income. Saving is a leakage in the cycle and therefore corresponds to the decrease in aggreagate demand. In the article's context, The Irish are untrusting and therefore unwilling to invest in new housing. This is all a result of bad planning. In the 1990s, Ireland's economy was booming: banks were doing well, the housing market rising significantly and in large demand. Therefore the government decided to build Adamstown. Yet as the housing bubble broke and with it the faith and confidencein the Irish economy, people put their spendings " on hold" as the article illustrates, and areas of modern infra structure such as Adamsville became Ghosttowns.

According to this Article inflation in Turkey increased to 10.45% and the central bank's Inflation rate was 5.5%. This difference in inflation rate occurs because when a country's central bank tries to fight inflation, as is being done in Turkey, the nominal interest rate will still tend to increase. Consequently, investment and consumption are discouraged due to the high inflation rate set by banks. This is because firms will not invest anymore because it is more expensive to borrow money and consume. In addition, consumption will decrease because the cost of borrowing money to consume large goods such as cars or houses is a lot more expensive.  

This is a classic example of cost-push inflation. The supply costs are increasing (in this case the workers wages) which means that SRAS shifts to the left, as less is being is being supplied. Firms hire less workers or produce less because of the high costs. As a result, price levels rise, unemployment levels rise and the real gross domestic product falls. This is also obvious because, if workers go on strike as mentioned in the article, then they are producing less goods, meaning that GDP obviously decreases. This could turn into an inflationary spiral. This spiral is because, when wages are increased for purposes such as to pay or rent or everyday goods, the firms also demand higher prices, which causes those who buy from them to charge more too. This is what causes the cycle to begin. Otherwise it could get to a point where currency becomes worthless.

This article states that Canada's inflation rate has unexpectedly slowed for a second month this past August, meaning a disinflation is taking place. The consumer price index in Canada rose 1.2% in August from a year ago compared to a 1.3% gain in July, showing a slowing down in the rate of inflation. This has reduced pressure for the Bank of Canada governor to raise interest rates. Normally, when a country's price levels are increasing and inflation is taking place, banks are encouraged to increase interest rates. Increasing them make it more profitable for consumers to borrow less and invest more, resulting in a decrease in consumption and therefore a decrease in AD. This will lower price levels in the country in the long run, solving or reducing the problem of inflation.

Based on the article it can be deduced that budget deficit plan in Germany is quite successful. Overall Germany has been able to accumulate a surplus of 8.3 billion Euros through tax revenues and social security funding in only 6 months. The surplus was quite unexpected because in 2011 their was a deficit in Germany. However, this surplus also suggests that the revised tax plan and fiscal policy in Germany are quite successful and that the nation is working towards fully reaching the 4 major economic goals, in particularly that of economic growth. However, the article also suggests that this surplus could decrease by the end of 2012, in which case the fiscal policy may not be as successful after all. To fully examine this budget deficit in Germany data from the whole year of 2012 is needed. However, as of now the article suggests that the policy implemented is quite a successful one.  

The National Institute of Economic and Social Research has advised the UK government to ease its fiscal policy because of the danger of the economy entering another recession. The UK fiscal policy is unintentionally causing deficient demand. Demand was already relatively low as private and public sectors were focusing on paying off their debts. This decline in demand has lead to a decrease in consumption and a fall in GDP. Also, businesses have become reluctant to invest due to the uncertainty about domestic and foreign demand. The UK government has been cautious about easing their fiscal policy because of their desire to achieve their fiscal goals, which they have been relatively successful in reaching so far, as stated by a Treasury spokesman who said: "… the government's commitment to deficit reduction has helped maintain market confidence". A way for the UK to ease their fiscal policy and subsequently increase demand would be to cut taxes, which would allow households to have a higher level of disposable income and firms would be incentivized to invest more because of the rising domestic demand.