Percentage of People Working Lowest Since the Early 1980s

So says CalculatedRiskBlog here:

[T]he participation rate declined to 64.2% - a new cycle low, and the lowest level since the early '80s. Note: This is the percentage of the working age population in the labor force . . .. The participation rate has now fallen 2 percentage points during the recession - a huge decline.

Two Thirds of Decline in Unemployment Due to Falling Participation Rate

So says CalculatedRiskBlog here:

If the participation rate had held steady at 64.5%, then the unemployment rate would have only declined to 9.64%. [Instead, unemployment fell to 9.4 percent.] 

So almost 2/3rds of the decline in the unemployment rate was related to the decline in the participation rate. Some of the decline might be from workers going back to school, but some is probably due to people just giving up.

A large portion of the decline in the participation rate was for people in the 16 to 24 age group. ...

Another group that saw a decline in the participation rate was men in the key 25 to 54 age group. I wonder if these people are just giving up? ... 

The participation rate has fallen sharply from 66% at the start of the recession to 64.3% in December. That is almost 4 million workers who are no longer in the labor force and not counted as unemployed in U-3, although most are included as "discouraged workers" or "Marginally Attached to Labor Force" in U-6. 

A decline in the unemployment rate mostly due to a decline in the participation rate is not good employment news.

Here is Mish's annotated version of the chart from Calculated Risk:

Problem Bank List Update: 829, or 2500?

The latest data on problem banks has been updated by the FDIC, showing an increase from 775 in the first quarter to 829 in the second, according to this story. An unofficial list of the problem banks receives regular updating here.

Compare that with these remarks from an anonymous commercial banker from California offered at Mish's blog here in an on-going series of posts about insufficient loan loss provisions at banks:

In my estimation, if every bank had the collateral of all loans accurately appraised and each loan’s loan grading was finely tuned for an expected loss based on financial performance and collateral values, the number of essentially bankrupt banks in this county would increase by a factor of 4-5 from the current level.

In other words, there is a potential pool of 2000-3000 banks that would be on the FDIC radar's for getting closed.

The health of the industry is not accurately reported by any means.

What continues at the heart of this issue is asset valuations and the accounting rules which govern them. Banks want the most liberal rules they can get, while taxpayers who end up footing the bill for bank malfeasance do not. Elected government officials and unelected bureaucrats in the middle have been and continue to be on the bankers' side, with a few notable exceptions, at a horrible cost to the taxpayers, who rightly feel that they have no voice.

And that's a big part of what all the fuss is about as the midterm elections loom.