Baltimore — (TFN): I spent most of my weekend in the attic of my century-old house. I wasn’t hiding from a hormonal, pregnant wife. She’s been fairly tame lately. And it wasn’t to escape a surprise in-law attack.

If you must know, I was installing an exhaust fan above the master shower. You’d think sometime over the course of the last 110 years, somebody would have done the job for me, but it turns out the task was all mine.

Now I know why.

While I was up there in a sea of pink insulation, I had one chore I was not looking forward to. With a ladder that reached just 25 feet, there was no way I was going to be able to caulk around the exhaust outlet some 35 feet in the air the easy way.

I was going to have to lean out the attic window and use every last bit of cell elasticity to reach my target.

As I was hanging there, with a pregnant wife hanging on to my right ankle, I couldn’t help but think about Obama’s “Cash for Caulkers” plan. It’s what happens when you hang upside down for too long.

I couldn’t help but wonder would it have been smarter to wait a few months and get reimbursed half my expense? Or, better yet, call up one of Biden’s 700,000 newly employed “green workers” to handle my caulk gun?

Nah, I’ll save them for when it’s time to scrape the old shingles off the roof this summer. If Obama thinks insulation is “sexy,” he’s going to love asphalt shingles in July.

*** In case you missed it this morning, the nation’s great orator organized another national pep rally. This time it was at a Home Depot store in Virginia.

Of course, Obama was not shopping for a new hammer or a couple of boards to build Bo a new doghouse, he was there touting the potential of his latest jobs initiative and economic booster, the so-called “Cash for Caulkers” program.

Even though I’m positive it was an in-and-out kind of speech, I wish the president had spent some time walking the aisles and shopping the store’s shelves. He may have learned a thing or two about the nation’s economy.

Most importantly, he would realize much of his plans are going to improve the lives of everybody but Americans. After all, the average home-improvement store is not filled to the brim with “Made in America” tags.

Home many windows, doors, rolls of insulation, tubes of caulk, washing machines, driers, ovens and dishwashers are made domestically these days? The only thing in Obama’s plan that is made in America is the ten-bucks-an-hour jobs of installing all those foreign-made goods. But that’s a one-and-done job.

Installing a couple of stimulus-bought windows and squeezing a tube of caulk won’t do much good this time next year when it’s time to fund little Johnie’s 529 plan.

That’s why I’m not buying this long-term recovery mumbo jumbo. I don’t trust a global economy supported by a wave of government spending. And neither should you.

If the default risk growing in Greece, Spain, Dubai and Austria is any indicator, the next few years are going to be doozies. It’s one thing when Bank of America can’t make its payroll. It’s a whole different story when it’s the folks charged with maintaining your safety and freedom.

You had better insulate your houses and caulk the windows shut now. You’re going to need the protection from the storm that’s brewing.

*** Did you hear the news from the timber industry today? It’s revolutionary stuff. It proves just why we are so bullish on the cyclical commodity.

Again, thanks to government intervention (or ineptitude), investors have some thinking to do. The question now is if Weyerhaeuser’s (NYSE:WY) long-debated plan of turning itself into a REIT makes the massive timber company a good buy.

As of this morning, corporate executives have decided to make the plunge and start paying the majority of its net income to shareholders. They are starting the payout with a special dividend that, while still undisclosed, is estimated to be worth about $29 per share in cash and stock.

It’s not a bad payout for a company with a $43 share price.

As hinted at above, any major move like this one is not a random act. Government’s over-arching hand has got to have something to do with it. In the case of Weyerhaeuser, the company is “going REIT” in an effort to avoid massive taxation.

By paying its profits to shareholders, the Washington-based company avoids the debilitating tax liability of owning millions of acres of valuable timberland.

Now Uncle Sam’s got to deal with the politically sensitive subject of trimming the top off all of those lucrative dividend payments.

It’s a good thing the IRS is hiring.

That’s how we signed off our March 4 column. Back then, big base-metal miners, including Lundin Mining, Southern Copper, and Freeport-McMoRan were in one of their worst slumps in recent memory. Investors couldn’t stand the thought of owning their shares. Copper prices are highly dependent on global economic health… and that health was in question.

But as we’ve covered with Home Depot and the Dow Transports, the market is now answering the global economic question with, “You know… things don’t look so bad.”

In addition to the strength in the Depot and the Transports, the price of copper refuses to decline from all-time highs near $4 per pound. These are all signs of economic strength. If this strength continues, expect the prediction above to come true… and expect Freeport-McMoRan (the world’s largest public copper producer) to keep rising.

Source: Expect The World’s Largest Copper Producer to Keep Rising

Net earnings for the biggest home-improvement retailer in the United States decreased to $356 million, or 21 cents a share, down from $1.05 billion, or 53 cents a share, the company earned during the same period last year.

Home Depot’s earnings report soured markets yesterday (Tuesday), which opened lower on the news.

“The home-improvement market remains difficult, but we believe the results show that Home Depot is making early progress in its efforts to refocus,” Chris Horvers, an analyst with The Bear Stearns Cos. Inc. (BSC), wrote in a research note today, Bloomberg reported.

Some of those refocusing efforts include closing doors. Earlier this month, Home Depot announced that it will shut down 15 of its core retail stores in a move that will curb operating costs and affect 1,300 employees. The announcement came 7 1/2 months after company CEO Blake said there were no plans to close any core retail stores.

The stores to be closed include: three in Wisconsin, two in Ohio, two in New Jersey, two in Indiana and one each in Kentucky, Louisiana, Minnesota, North Dakota, New York and Vermont.

The company also plans to delay expansion plans, saving $1 billion over the next three years, Blake said on a conference call.

“Home Depot is bouncing back from the problems that (former CEO Robert) Nardelli passed along,” Burt Flickinger, managing director at New York-based Strategic Resource Group, said in a Bloomberg Television interview.

Flickinger said that Blake “is doing a great job with his team in rebuilding the business for the future.”

Though Home Depot didn’t lower its full-year forecast, Chief Financial Officer Carol Tome said earnings could be at the low end of its forecast.

Such wasn’t the case for its rival, Lowe’s Cos. Inc. (LOW), which after reporting an 18% decline in first-quarter profit, lowered its full-year outlook. The No. 2 home-improvement retailer in the United States said it expects a per-share profit of $1.45 to $1.55 for the year. Previously, its outlook for the fiscal year ending Jan. 30 was pegged at $1.50 to $1.58 a share.

“The external pressures facing our industry will likely persist throughout 2008,” said Chief Executive Robert Niblock on a conference call.

Indeed, Home Depot and Lowe’s have a litany of problems in the near future. Gasoline prices are above $3.75 a gallon. Consumer confidence is at its lowest level in almost 28 years, according to Reuters/University of Michigan preliminary index of consumer sentiment released May 16.

Specific to the housing industry, sales of previously owned homes (which comprises 85% of the housing market) fell again in March, the seventh decline in eight months. Those homebuyers are reliable customers for both Home Depot and Lowe’s, as they often buy their homes with renovations and remodeling in mind.

Source: Home Depot Reports 66% Quarterly Profit Decline, Suffers Storm with Lowe’s

• Exxon Mobil Corp. (XOM) said yesterday (Thursday) that record crude prices helped its first-quarter profit climb 17% to $10.9 billion – the second-biggest U.S. quarterly corporate profit ever, the Associated Press reported. The company said earnings for the first three months of the year came to $2.03 per share, up from $9.3 billion, or $1.62 per share, a year ago.

• General Motors Corp. (GMC) has taken an undisclosed stake in Mascoma Corp., a renewable energy company that is working to develop ethanol from wood chips, waste paper sludge and switch grass, according to the Associated Press. GM said the new collaboration would further develop non-grain forms of ethanol for more environmentally friendly vehicles.

• The Home Depot Inc. (HD) announced yesterday (Thursday) that it will shut down 15 of its core retail stores in a move that will affect 1,300 employees. The announcement comes 7 1/2 months after its Chief Executive Officer Fred Blake said there were no plans to close any core retail stores. The stores to be closed consist of three in Wisconsin, two in Ohio, two in New Jersey, two in Indiana and one each in Kentucky, Louisiana, Minnesota, North Dakota, New York and Vermont, the Canadian Press reported.

• Ajman, one of the United Arab Emirates, announced that it has partnered with Solidere International to develop a $60 billion new coastal city to be named Al-Zorah, Bloomberg reported. Twelve kilometers of coastline will be set aside for development of officers, shops, schools and hotels.

• Wheat hit a five-month low yesterday, as rising supplies and a resurgent greenback have pushed the soft commodity’s July delivery futures to $7.7835 a bushel, Bloomberg reported. Since hitting a record $13.495 on Feb. 27, wheat prices have fallen 42%.

• Shares of NetManage Inc. (NETM) surged over 67% yesterday (Thursday) after London-based Micro Focus International PLC announced it would buy the California-based software firm for $73.3 million, or $7.20 per share, Reuters reported. NetManage stock gained $2.79 per share to close at $6.94.

• Miami-based Burger King Holdings Inc. (BKC) announced first quarter earnings increased 21%. The fast food burger restaurant said it earned $41 million, or 30 cents per share, an increase from $34 million, or 25 cents per share for the same period last year. Revenue increased to  $594 million from $539 million for the same period in the prior year.

• PharmaNet Development Group Inc. (PDGI) shares plunged yesterday (Thursday) after the company announced a first quarter loss of $10.1 million, or 53 cents per share, due to canceled contracts. The global drug firm also lowered its outlook for full-year 2008. The stock dropped $6.76, a decline of 28%, to close at $17.10.

During the great credit crisis of 2007, Home Depot led America’s “consumer sensitive” stocks off a cliff. Shares in America’s largest home retailer fell from $40 to $25 in just seven months. But despite horrible housing headlines, the Depot has refused to break its January low.

We don’t know if the worst is over for the U.S. economy. But we can look to stocks like Home Depot for clues on how things will turn out. Home Depot lives and dies by America’s ability to spend money on roofing, room additions, and lawn supplies. If folks aren’t spending money on the American dream, we’re in trouble. Unemployment claims are likely to keep rising, and housing numbers are likely to keep sinking. But stocks tend to look six to 12 months ahead and price themselves accordingly. Right now, Home Depot is casting its ballot with the “things aren’t so bad” camp.