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At the moment globally there has been a spike in food prices. One of the causes has been the severe droughts in the United states which have driven up the food prices. In response to this inflation the government of Brazil decided to reduce taxes on basic household goods to support an economic recovery. This action also leads to stabler prices, which is one of the macro-economic goals of a country. The tax break on household goods allows for a increase in consumption as consumers will feel wealthier and have an increase in purchasing power. As a result this will increase Brazil's GDP to a certain extent as Consumption is one of the factors that influence the gross national product. 

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. 

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. 

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. 

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

Brazil's President Dilm Rousseff a 66 billion dollar stimulus plan to revive the country road and transport systems in order to bolster the economy. The government predicts a growth of 3% in 2012, down from the 4.5% growth in 2011. In order to maintain the GDP growth at what it was the previous year the government plans to invest 66 billion dollars into the country transport system in order to promote jobs and growth within the country. As this is not a transfer payment (tax revenue redistributed to pensioners, veteran, and the unemployed) the government is contributing to the economies gross domestic product. This stimulus plan would go to wages of the people working on the transport system and the purchase of capital goods necessary to make the improvements. In order to maintain the GDP per capita in Brazil it is necessary for the economy to grow at the same rate as the population.