Morning Business Memo:

It's nothing less than a remarkable about-face. One of the architects of mega banking is now calling for the breakup of the world's largest banks. Sandy Weill, formerly CEO of Citigroup, told CNBC: "What we should probably do is go and split up investment banking from banking, have banks be the deposit takers, have banks make commercial loans and real estate loans, have banks do something that's not going to risk the taxpayer dollars, that's not too big to fail."

In the late '90's Weill was a global banking pioneer, building Citi into a financial supermarket. Now "I am suggesting that they be broken up so that the taxpayer will never be at risk," said Weill, adding his voice to a growing chorus of regulators, and financial experts.

"Our system has been hijacked and we need to change it," says Neil Barofsky, former special inspector general in charge of oversight of TARP. Breaking up the banks, says Barofsky, "is widely accepted." Barofsky, who makes his case in the new book, "Bailout," claims "the only people who have not accepted this it seems like is the big banks themselves and the politicians they seem to affectively control in Washington."

Another scandal at a large financial firm… Nomura Securities CEO Kenichi Watanabe has resigned in the wake of an insider trading scandal at Japan's biggest investment bank. Watanabe announced his resignation at a press conference in Tokyo. Takumi Shibata, another top executive at the bank, has also resigned. Watanabe, 59, will be replaced by Koji Nagai, the president of Nomura Securities, which is part of the Nomura banking empire. Japan's financial regulators are investigating Nomura Securities for leaking information to clients ahead of planned securities offerings by energy company Inpex, Mizuho Financial Group and Tokyo Electric Power Co. in 2010.

What has the corporate earnings season told us so far? Europe is a big drag on profits and sales. That was clear from disappointing earnings at UPS. Dow Chemical, Ford and Apple have also blamed their less-than-stellar numbers on a decline in European demand. "The corporate alarm bells highlight how the miserable economic conditions in much of Europe are spilling onto the global stage," reports The Wall Street Journal.

Another low for the US Treasury 10-year note. Now down to 1.39 percent, as many investors by US Treasuries as a safe alternative to stocks. The collapsing yield has prompted a fresh wave of mortgage refinancing.

Shares of online games company Zynga plunged 40 percent in after-market trading after it cut its full year outlook.

Richard Davies Business Correspondent ABC NEWS Radio twitter.com/daviesabc

Note: Morning Business Memo is taking a summer break, and will return on Monday August 6.