Why Citigroup Got Hammered This Weekhttp://www.fool.com/investing/general/2013/06/21/why-citigroup-got-hammered-this-week.aspx John Grgurich
June 21, 2013
About three hours into the week's final day of trading, Citigroup (NYSE: C) stock is down a staggering 6.80%. There's no mystery as to what's behind the plummet, as well as the rest of the market's demise this week: a little thing Ben Bernanke likes to call "tapering."
The Fed giveth, and the Fed taketh away
So long as the economy continues to improve, the pace of bond-purchases will begin to slow later this year, with a target of mid-2014 for a complete halt to buying. By then, the rate of unemployment is projected to be down to 7%. Finally, interest rates will be kept low until unemployment drops to 6.5%.
Foolish bottom line
Of course, no one should be surprised at the Fed's move. Bernanke's been talking about tapering for months, without announcing any firm plans. I think it's obvious he's been trying to prepare investors for the inevitable: that QE had to end sometime, and that time is now. Although that isn't even the case: Tapering will only begin later this year, and then only if the economic data remains positiv