The Federal Reserve expects to start pulling back later this year from its economic stimulus efforts, the Fed chairman, Ben S. Bernanke, said on Wednesday. Increasingly confident in the durability of economic growth, the central bank plans to gradually scale down its monthly purchases of Treasury securities and mortgage-backed bonds beginning later this year and ending when the unemployment rate reaches 7 percent, which may happen by the middle of next year, Mr. Bernanke said, Binyamin Appelbaum reports in The New York Times. After that, the central bank would take several more years to unwind the rest of its stimulus campaign.
Mr. Bernanke emphasized that the timing of the retreat depended on the health of the economy. Pulling back “would basically say that we’ve had a relativelydecent economic outcome in terms of sustained improvement in growth and unemployment,†Mr. Bernanke said. “If things are worse, we will do more. If things are better, we will do less.â€
The comments appeared to disappoint investors, who had hoped the Fed would do more for longer, Mr. Appelbaum writes. The Standard & Poor’s 500-stock index fell 1.39 percent and interest rates rose, as investors sold both stocks and bonds.
“The steep market declines on Wednesday underscored the fears circulating through trading desks,†Nathaniel Popper writes in The New York Times. “One concern is that the economy is not strong enough to do without the Fed’s support. Another is that the Fed’s decision to ease off the gas could, in itself, cause enough turmoil in the markets that economic growth could be threatened.â€
SONY REBUFFS NEW CALL TO SELL ENTERTAINMENT UNIT  | After a renewed push by the hedge fund manager Daniel S. Loeb to break up Sony, the company’s chief executive reiterated that the music and movie businesses were not for sale, though the board would continue to study the matter, Hiroko Tabuchi reports in DealBook. Speaking at Sony’s annual meeting in Tokyo on Thursday, the chief executive, Kazuo Hirai, said that movies and music were an indispensable part of the company’s growth strategy.
“The entertainment business plays an important role in Sony’s future growth,†Mr. Hirai told investors, saying it added critical value to the company and should not be let go. “This proposal strikes at the heart of what kind of company Sony ultimately will become in the future. We intend to take our time in discussing it.â€
A K.K.R. EXECUTIVE CAMPAIGNS FOR GAY MARRIAGE  | Ken Mehlman, a once-closeted Republican operative who orchestrated President George W. Bush’s 2004 re-election on a platform that included opposition to same-sex marriage, is now trying to convince fellow Republicans that gay marriage is consistent with conservative values, Sheryl Gay Stolberg writes in The New York Times. “He remains controversial, both applauded and vilified. On the left, he is either an unlikely hero or a hypocritical coward. On the right, some Republicans embrace him; others deem him a traitor,†Ms. Stolberg writes.
Coming out “has been a little bit like the Tom Sawyer funeral, where you show up at your own funeral and you hear what people really think,†Mr. Mehlman said in an interview in his office at Koh! lberg Kra! vis Roberts, on the 42nd floor of a Midtown skyscraper. “A big part of one’s brain that used to worry about this issue has now been freed to worry about things that are much more productive.â€
ON THE AGENDA  | Markets in Asia slumped and European markets were sharply lower, after the Fed’s announcement and the release of data showed China’s economic growth was slowing. Oracle reports earnings after the market closes. Data on sales of existing homes is out at 10 a.m. John Stumpf, Wells Fargo’s chief executive, is on CNBC at 7 a.m. Leon G. Cooperman of Omega Advisors is on Bloomberg TV at 9 a.m.
BLACK IDENTIFIED AS BUYER OF DRAWING  | Leon D. Black of Apollo Global Management was the buyerof a $47.9 million Raphael drawing in an auction at Sotheby’s in London in December, according to The Wall Street Journal. But British authorities are “blocking Mr. Black’s attempts to export the drawing in an effort to keep it in the United Kingdom,†the newspaper says.
FOR FULD, A FIGHT OVER AN APARTMENT LOAN  | Richard S. Fuld Jr., former chief executive of Lehman Brothers, has sued his estranged son-in-law over a loan for the purchase and renovation of a Manhattan apartment, Bloomberg News reports. Mr. Fuld’s son-in-law, Aaron Packles, is accused of “inducing plaintiff to advance significant sums†for the apartment on the Upper East Side of Manhattan by “falsely repres! enting th! at defendant intended to repay that loan, failing to disclose his true intention to aver falsely that the apartment and renovations were a gift, and his failure to repay those funds to date,†the lawsuit says, according to Bloomberg News.
Mr. Packles and the daughter of Mr. Fuld, Christine, paid $9.75 million in cash for the apartment in 2007, before putting it on the market in January 2009 for $12.95 million, The New York Times reported at the time. They lowered the asking price six weeks later to $9.8 million.
