05/16/2012 07:59 am ET

Greece Heads For The Euro Exit: Seven And A Half Things To Know

Thing One: Greeks Walk, Don't Run, From Banks: It's not exactly a panic or a full-blown bank run yet, but it looks like Greece is starting to speed-walk away from its banks -- and maybe the euro.

Greeks pulled nearly $900 million out of their banks on Monday and seemed to be withdrawing money at a similar pace on Tuesday, Reuters reports. It could be the early, warm-up phase of a full-fledged bank run, which would be very bad news indeed for Greece and the rest of Europe, and probably the U.S., too. Greek banks are leaning ever more heavily on the European Central Bank for funding, writes the Wall Street Journal. The bank withdrawals came after Greek political parties failed to come up with a coalition government, meaning there will be elections next month, from which anti-austerity parties are likely to gain even more strength. That makes it even more likely that Greece will back out of deals to exchange austerity for bailout cash. That makes it even more likely that Greece will end up leaving the euro zone.

And that's why people are pulling their cash out of banks now -- if Greece is going to leave the euro, Greek deposits could suddenly lose value in a big hurry. The risk is that a full-on bank run could bring down the Greek financial system, causing the euro exit that depositors fear anyway, the WSJ writes. New French President Francois Hollande, after having his airplane struck by a lightning bolt from Zeus, met with German Chancellor Angela Merkel to discuss the European mess, and they offered to help Greece grow as long as it stayed committed to austerity. There may need to be quicker action than that soon, or this could be another ugly summer for markets and the economy on both sides of the Atlantic.

Thing Two: Crazy, Dimon: It was a good-news, bad-news sort of day for JPMorgan Chase as it continues to deal with the fallout from its $2 billion (and counting) trading debacle. The FBI launched a probe into the bank's accounting and disclosures, but at the same time Jamie Dimon managed to avoid much shareholder wrath at the bank's annual meeting. They let him keep not one but two of his jobs and rubber-stamped his pay package. In fact, he only barely seems to have tempered his anti-regulation spiel, which The Huffington Post's Hunter Stuart has compiled in a brilliant video mashup.

Thing Three: GM Backs Out Of Facebook: This might make Facebook's IPO road show a little awkward: General Motors is pulling its ads from the social network, the Wall Street Journal reports, saying they really aren't effective enough to justify the cost. This is at the very least a public-relations blow to Facebook, which is trying to justify to investors its sky-high valuation. Said valuation just keeps on climbing, though, as zombie-like investors keep trying to claw their way into it, pushing the company to increase the price of its shares and the size of its offering. The latest tally values Facebook at more than $100 billion. Perfectly reasonable.

Thing Four: Another Budget Bummer: Remember last year how a pointless, unnecessary government showdown over the debt ceiling resulted in a credit-rating downgrade for the United States, crashed the stock market and darn near wrecked the entire economy? That was awesome, right? Well, good news, everybody, America's Top Oompaloompa, House Speaker John Boehner (R-Wonka), wants to get the gang back together for an encore this summer, The New York Times writes: "Speaker John A. Boehner on Tuesday set the stage for a bruising election-year showdown on fiscal policy, vowing to hold up another increase in the federal debt ceiling unless it was offset by larger spending cuts."

Thing Five: Misappropriation Of Funds: The New York Times has a story on its front page today about how the states are using money from the $25 billion mortgage settlement to solve their budget problems. Recall, that money was supposed to help homeowners. This is not new news, actually! It's been going on for months, and HUD Secretary Shaun Donovan has warned the states to spend the money the right way. The states still aren't listening.

Thing Six: Samsung Blue: Losing $2 billion isn't cool. You know what's cool? Losing $10 billion. That's what Japanese chip maker Samsung lost in market value this morning after a Taiwanese news report that Apple was sending business to a Samsung rival, Reuters writes.

Thing Seven: The Pepsi Challenge: PepsiCo has been struggling a little bit lately, losing some market share to rival Coca-Cola. That has apparently attracted the interest of activist shareholder Ralph Whitworth, who has taken a big stake in Pepsi and has started meeting with management, Bloomberg writes.

Thing Seven And One Half: On this day in 1966, the Beach Boys released Pet Sounds, a watershed moment in musical history. The album was groundbreaking in its use of the studio, in its mix of unusual sounds and instruments. Brian Wilson's direct response to The Beatles' Rubber Soul, Pet Sounds inspired John Lennon and Paul McCartney (who called "God Only Knows" his favorite song of all time) to record Sgt. Pepper's Lonely Hearts Club Band. Pet Sounds sits at No. 2 on Rolling Stone's list of the greatest albums of all time, right behind Sgt. Pepper's, and it's still influencing bands to this day.

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Calendar Du Jour:

Economic Data:

8:30 a.m. ET: Housing Starts and Building Permits for April

9:15 a.m. ET: Industrial Production and Capacity Utilization for April

2:00 p.m. ET: FOMC Minutes for 04/25

Corporate Earnings:

Before Market Open:

Abercrombie & Fitch



Time Not Specified:


Heard On The Tweets:

@EddyElfenbein: Facebook's price range has been raised from arrogant to insulting. Still not a buyer.

@jmackin2: Hollande/Merkel to Greece (1): we'd like to help you, but we're not going to.

@jameschappers: Hollande's plane turned back from Paris after being struck by lightning, Olympic flame snuffed out. The Greek gods are NOT HAPPY

@BCAppelbaum: This whole JPM story underscores reason we don't have effective regulation: Our public officials don't understand finance.

@ReformedBroker: Dimon: In retrospect, we should not have bet against The Avengers movie

-- Calendar and tweets rounded up by Khadeeja Safdar.

And you can follow us on Twitter, too: @markgongloff and @byKhadeeja