by Laura Conaway

Good morning and welcome to the last week of summer.

The U.S. taxpayer is turning a profit on some of the bank bailouts. Eight of the biggest banks have paid off their TARP loans, with a $4 billion and average 15 percent annualized return. American Express and Goldman Sachs top the list of bigs with big returns for the common person. Citigroup and Bank of America top the list for bigs that haven't paid back a cent.

Meanwhile, the Wall Street Journal (subs. requ'd.) notes that the FDIC has backed most of the risk on $80 billion as it tries to get solvent banks to buy up the assets of failing ones.

Japan has voted its Liberal Democratic Party out of office after 54 years of being in charge. Chalk the defeat up to two decades of economic stagnation.

Eurozone prices fell again in August, for the third straight month of negative inflation. The fall was at least slower than it has been, likely because oil prices are falling at much slower clip.

The Chinese got more bounce from their stimulus spending, are racing ahead on solar panels and now plan to sell an electric car in the U.S. in 2010.

Conversations worth joining, after the jump.

 

The American economy is developing two clear tracks, and it's just fat cats vs. the rest of us, the Wall Street Journal has been reporting. It's also the big banks that can still get credit and the little ones squeezed out of the market. Baseline Scenario runs the forecast — it's kinda gloomy.

And in other debates you might want to join, the Economist has taken its turn on whether private schools are charities. This one started with Matt Yglesias, followed by a big push from Planet Money pal Felix Salmon.