As part of a $24 billion economic stimulus bill, the expanded and extended home buyer tax credit is now law.

The features of the bill are as publicized throughout the week;

• deadline extended through April 30
• April 30 deadline requires only that the contract is signed
• Qualified purchases must close by June 2010
• a reduced tax credit of up to $6500 is opened to existing home owners

Other provisions in the new stimulus focus on extending unemployment benefits. Today's increase in unemployment percentages provided the backdrop of today's signing

Here are the President's remarks. In his remarks, President Obama made the point that the credit is "fully paid for." Though he did not elaborate on that. I think he is referring to the deferring a seperate business tax credit.

The president also remembered those suffering in the Ft Hood shooting.

Congratulations to the Red Bank Lions football team. Last week they finished regular season play undefeated and with the number 1 ranking in the state.

Tomorrow they begin their playoff run.

Anything can happen of course, but this is a special team.

Great job and good luck tomorrow.

As the economy starts the turn around, employment becomes more important measure of the strength and sustainability. As a lagging indicator, employment gains will always trail recovery, but families and the economy need more jobs. The job creation target is 400,000 new claims. Today's New Unemployment claims number of 512,000, despite continuing improvement, remains above that magic job creation level.

This means the economy is still losing jobs. On a personal note, the paper mill in my hometown has just announced plans to close. The impact on my home town will be massive. 1100 jobs. Wow. And what do you do with a closed paper mill?

Tomorrow's unemployment numbers will be very important, more so than usually. September showed an increase breaking a trend of monthly improvement.

The question is - Was September's increase a blip or a trend. Expectations are unemployment will slide higher, maybe to 10%?

Estimates are that 16-20% are underemployed - combining the unemployed seeking work with the working parttime instead of full time or no longer seeking employment.

To sustain the recovery jobs must come back. With closing factories, the jobs may need to be in new industries.

Last night two local teams, the Lady Bucs of Boyd-Buchanan and the Lady Lions of Red Bank, won state championships in high school volleyball. For Boyd-Buchanan this year was a return trip to the Class A state final. This year they won, completing a 20-0 season within their state classification.

The final match was 3-0.

For Red Bank, where my son played basketball and my daughter was on a state championship soft ball team, this is the first time in the class AA state final in 19 years. This is the first state title for the Red Bank volley ball team.

Red Bank won their final match 3-1, after fighting through the loser's bracket.

This past decade Red Bank has won state championships in football and in girls softball.

The MVP's were Stephanie Sivvvlvers for Boyd and Courtney Lawson for Red Bank.

Congratulations to both teams and both schools.

The Calculated Risk Blog is a highly recommended read. This week there was a post with this chart on the growing distinction between new and existing home sales. The phrase used is "Distressing Gap."

In the post, some important points were made about the increased value to employment and the economy from new construction home sales.

The impact on the local economy of new homes construction is very great.

The model used estimates "impacts on income and employment in 16 industries and local government, as well as detailed information about taxes and other types of local government revenue." The model "estimates of the local impacts of building 100 single family units, 100 rental apartments, and $10 million worth of spending on residential remodeling (equivalent to 100 remodeling jobs at $100,000 each)1 in a typical U.S. metropolitan area, "

The estimated 1 year local impact of 100 single family new construction homes:

• $21.1 million in local income
• $2.2 million in local govenment revenue
• 324 local jobs created

The estimated continuing annual impact of 100 single family new construction homes"

• $3.1 million in local income
• $743,000 in local government revenue
• 53 local jobs created

 Similar estimates are provided for multi-family construction and residential remodeling.

The information from these studies should be emphasized and understood. We are all fully aware that new construction has fallen off, but I assumed that the drop was in line with the drop in home sales in general. The statistics in the Calculated Risk post show that new home sales have fallen significantly more than existing home sales.

This is not good for local economies to have such a disparity between existing home sales and new construction home sales.

The push for First Time Home Buyer with the tax credit and the increase in distressed properties are cited in the Calculated Risk post as major contributing factors to this growing gap in new and existing home sales.

To those factors I would add the loss of many construction financing programs, and the general tightening of qualifying standards in general that has pushed a very large portion of potential buyers out of the market - many of them minorities. On that topic, I will write more later.

With numerous good reports on the economic front over the last few weeks, many are starting to suggest that the recession is over. Jobs though continue to be a problem.

To answer questions about the impact of the stimulus program, the administration has announced that the stimulus is approaching 1,000,000 jobs saved or created. From the White House blog.

According to information on Recovery.gov, Tennessee has been an especially fortunate recipient of the stimulus funds.

Still, Tennessee's unemployment remains over 10% through September, despite the 1156 jobs identified as created by the stimulus. Some good news is starting to be announced locally. More on that later.

UPDATE STIMULUS IMPACT FOR TENNESSEE: Posted November 1, 2009

As promised the stimulus figures were updated on Recovery.gov. The new figures indicate that the stimulus has created over 640,000 jobs nationwide, and 9548 in Tennessee.

The administration support, and the approaching deadline, has given much momentum to the extension and the expansion of the First Time Home Buyer tax credit.

In fact it would no longer be a first time home buyer tax credit. Just a home buyer tax credit.

Provisions of the tax credit agreement

• Deadline to be extended to April 30
• Existing home owners, who have owned prior residence at least 5 years, may receive up to $6,000
• Income limits increased to $125,000 for singles and $225,000 for couples
• Homes over $800,000 are not eligible

There would be a significant change to the new deadline - rather than closing by April 30, the contract must be accepted by April 30. (No back dating, right.)

Some senators are insisting that this is the "last extension."

Estimates on the boost from the tax credit, as far as actual new home sales, vary - from no impact to significant impact.

One thing known - the cost. Another $10,000,000,000 or so.

I love the logic about how to pay for the tax credit. From the HILL.com , "Senate Finance Chairman Max Baucus (D-Mont.) said that the cost will be offset by delaying a tax break for U.S.-based international corporations that was scheduled to start in 2010."

This tax credit will be funded by delaying another tax credit - not by cancelling the other tax credit but by delaying.

The Chattanooga Community Kitchen is in the process of its Fast Day Fund raiser.

This fund raiser has taken different forms, but has been the main fund raiser for the Kitchen for many years.

The Kitchen has received national recognition as a model for a local non profit organization. It was originally started in 1982 as a feeding program. There were 7 downtown churches that partnered to meet a growing need in Chattanooga.

The Kitchen has its own blog. You can stay current on needs and on offerings by checking updates here.

The main program is to provide food 365 days a year:

• Breakfast 7:00am to 8:00am seven days a week
• Lunch 11:00am to 11:45am seven days a week
• Dinner 4:00pm to 4:45pm weekdays

Other programs focuson employment, shelter, counseling. A big help for many homeless is that the Kitchen provides a place for basic, essential services like bathrooms and showers, telephones, mail, washers and driers, and more.

The Community Kitchen is well known and well respected in Chattanooga because of its long service to the needs of our community.

You can help by volunteering or with a donation. Click here to make a donation.

Whether or not you agree with the First Time Home Buyer tax credit, the Obama administration through Treasury Secretary Tim Geithner and HUD Secretary Shaun Donovan has called for the credit to be extended.

Such support from the administration may very well be sufficient to pass the extension. Evidently, the tax credit is seen as a critical to continue the jump start of the economic recovery.

It still seems to me that the tax credit is not doing much in the way of creating new buyers, and that it mostly takes from from future sales. But the recent and unexpected drop in home sales appears likely to push through the tax credit extension.

Udate: Bloomberg article describes building momentum for extension and for expansion of the tax credit.

The Chattanooga Renaissance Oktoberfest was held this past weekend.

My friend and local social networking hero, insurance agent extraordinaire Jon Moss provided these videos.