Caterpillar Inc. (NYSE: CAT) today announced that it would slash 20,000 jobs as the boom in ethanol production that fueled the company's growth is turning into a bust. Earnings at the farm and heavy-machinery equipment maker also will trail analysts' forecasts.

But wait. There's more.

Home Depot Inc. (NYSE: HD), whose reputation suffered under the leadership of former CEO Robert Nardelli, will slash 7,000 jobs and exit the EXPO business. I am sure this won't make workers at Nardelli's current employer Chrysler LLC feel too good. Sprint Nextel Corp. (NYSE: S), whose troubles pre-date the economic slump, is firing 8,000 workers as it seeks to lower its expenses by $1.2 billion.

Thousands more jobs will be axed in the Pfizer Inc.'s (NYSE: PFE) $68 billion acquisition Wyeth (NYSE: WYE). Who knows how many employees will get chopped now that the Dow Chemical Co. (NYSE: DOW) purchase of Rohm & Haas Co. (NYSE: ROH) will not take place. Let's not forget Starbucks Corp. (NASDAQ: SBUX), which reportedly is firing 1,000 workers at its corporate headquarters.

The Big 3 CEOs are trying to turn lemons into lemonade.

After being pilloried by members of Congress for flying in separate corporate jets to beg for a $25 billion bailout from the federal government, Rick Wagoner of General Motors Co. (NYSE: GM), Ford Motor Co.'s (NYSE: F) Alan Mulally and Robert Nardelli of Chrysler LLC want to show that they have learned their lesson. They decided to drive eight hours from Detroit to Washington before testifying on Thursday.

Moreover, they are milking their roadtrip for public relations purposes. Wagoner is traveling via Chevrolet Malibu hybrid and Mulally is driving a hybrid Ford Escape. Nardelli has not finalized his plans yet but as BusinessWeek notes "he's not flying a corporate jet. That's for sure." I would be stunned if he does not motor to the nation's capital in a Chrysler hybrid.

This whole exercise is silly, but it has a serious purpose. The negative publicity from the corporate jet story cost the Big 3 critical support for the bailout. Some analysts are suggesting that GM and Chrysler may not be able to wait for the Obama administration to take over next month. Ford can hold on a while longer.

When the CEOs of General Motors Corp. (NYSE: GM), Ford Motor Company (NYSE: F) and Chrysler again take the steps up to the U.S Congress tomorrow, they will again try to convince U.S. lawmakers that a $25 billion injection into all three companies will somehow stave off their collective death along with over a million U.S. jobs that would be lost if the three automakers cease to exist.

GM's Rick Wagoner, Ford's Alan Mulally and Chrysler's Bob Nardelli -- all of whom flew to the last meeting with Congress on expensive private jets -- will be back in action tomorrow to try for the second time to siphon $25 billion from the federal government. Oops, I mean, the U.S. taxpayer. A few weeks ago, the trio were labeled as unprepared and failed to convince the majority of Congress that $25 billion would allow all three companies to somehow retool their complete efforts pretty fast.

If Wagoner, Mulally and Nardelli can't make their vision compelling with facts, future plans, some kind of competitive strategy and a five-year layout on changes they will make, along with being held accountable to each of them, then the end of the American auto manufacturing triumvirate as we all know it may be the end.

Of course, like many pundits, I sincerely believe that this is all for show and that a structured bankruptcy is the "way out" for at least Ford and GM at this point.

Speaking of leaders, Ford's Mulally -- who has shown some excellent chops at trying to rescue Ford in his two plus years there -- may be the only CEO that needs to stay. Wagoner needs to go (actually, years ago), and why on earth Chrysler nabbed Home Depot shenanigan master Nardelli is beyond comprehension.

Sometimes, it's hard to determine if major investors are being overly optimistic, outright daffy, or are simply seeing something that the rest of us just don't see.

In my view, the current course of events at Chrysler Corp. is one of those difficult to determine situations. On its face, it looks like it could be a case of basic business logic in action. But on closer examination, it just doesn't make sense, at least not to me.

Declaring a payoff horizon of ten years, Cerberus Capital Management has placed a great deal of faith in Chrysler, the American auto manufacturer which is best described these days as an also ran. The kicker is, the Cerberus ten year plan is being initiated at a time when auto industry profitability is near impossible. Consider also the fact that current Chrysler management openly admits that the company isn't in any condition to go it alone.

And there's more trouble in the mix. Cerberus said in a New York Times story that Chrysler is meeting "every financial metric." But Cerberus considers the world's current economic turmoil to be a temporary problem, not the economic world change that it actually is. Meanwhile, Chrysler CEO Bob Nardelli is smiling because Cerberus has given Chrysler lots of money, and he gets to cut heads.

Chrysler Corp., owned by private equity firm Cerberus Capital, has said what many auto industry watchers have suspected for a while. It's "operationally bankrupt," according to Chrysler boss Robert Nardelli (who left Home Depot this year after compensation padding during HD's poor performance). Nardelli walked into a nightmare, which was fitting since he left one company in his messy wake and joined another that was already in progress. How fitting.

Anyway, Chrysler, who is selling assets and trying to reorganize into something recognizable as an auto manufacturer, is apparently running out of cash. When Nardelli was asked point-blank if Chrysler was bankrupt, he answered slyly with "Technically, no. Operationally, yes. The only thing that keeps us from going into bankruptcy is the $10 billion investors entrusted us with." Thank goodness for Cerberus, eh?

Chrysler is trying to raise capital by selling land, older factories and other tangible assets (probably at a loss to book value), but with Cerberus now being exposed to the effects of the subprime mortage industry's implosion with its ownership of GMAC (bought from General Motors for $12 billion), it can't just prop up Chrysler without seeing the company shed itself of useless assets as quickly as possible. Would you buy a Chrysler vehicle with all this uncertainty? If customers start using that in their decision-making process, the world of hurt could get even worse.

MAJOR PAPERS:

• With his company's stock near a 52-week low, Robert Willett, CEO of Best Buy Incorporated's (NYSE: BBY) international operations, bought nearly $500K in stock, reported Barron's Online's "Inside Scoop" section.
• In a rare instance of a foreign company being allowed into the Chinese onshore oil and gas industry, Chevron Corporation (NYSE: CVX) will develop a natural gas filed owned by PetroChina Company Limited (NYSE: PTR), reported the Wall Street Journal.
• The Wall Street Journal reported that Sun Microsystems Inc (NASDAQ: SUNW) is today expected to introduce a new microprocessor called UltraSparc T2, will be able to process up to 64 threads at one time -- most chips can handle up to four threads at a time.
• According to the Financial Times, citing a source familiar with his pay package, Robert Nardelli will college a salary of $1 a year in his new role as CEO of Chrysler, which is 20% owned by DaimlerChrysler (NYSE: DCX).

OTHER PAPERS:

• The New York Mercantile Exchange (NYSE: NMX) is quietly selling its lower Manhattan headquarters, asking for between $600M and $700M, ahead of a deal to sell itself, reported the New York Post.

Dealbook reports that Home Depot, Inc. (NYSE: HD) will sell its weakly performing HD Supply Unit to a group of private equity firms for $10 billion.

In effect, Home Depot is finally realizing what a colossal blunder its former CEO, Bob Nardelli, made in creating the business back in 2000. The reason it was such a lousy investment is that the Supply Unit works with builders who have much greater negotiating leverage than individual homeowners. The result is that the margins Home Depot earned in selling home building supplies to builders were lousy.

Nardelli, who resigned this January with a $270 million haul after six years of presiding over Home Depot's stagnant stock during one of the biggest housing booms in history. Now it will be up to Bain Capital, the Carlyle Group and Clayton Dubilier & Rice to find a way to boost the profits of this $10 billion business.

Home Depot stock is up 1% in pre-market trading. This suggests that while the market likes the move, it wonders how management will come up with $10 billion worth of more profitable revenue to make up the low margin revenue to be heading the way of private equity.

Peter Cohan is president of Peter S. Cohan & Associates, a management consulting and venture capital firm. He also teaches management at Babson College and edits The Cohan Letter. He has no financial interest in Home Depot.

It was quite a surprise in 2006 when Home Depot's (NYSE: HD) then-CEO, Robert Nardelli, shunned all questions from the analyst and shareholder community at the retailer's annual shareholder's meeting. In fact, Nardelli suggested that Home Depot board members just stay home, and they happily obliged. Zac covered this when it happened, and I had to get my mitts on this as well since it burns me up a bit. It never ceases to amaze me the arrogance that some corporate leaders have when it comes to answering the hard questions from the people that watch their company. Note to Nardelli: for future reference, shareholders OWN the company, and it is the fiduciary and ethical responsibility of management to answer questions and respond to the concerns of the owners. Companies do not own shareholders -- it's the other way around. Period.

Now, I know some shareholders make outlandish demands and don't act rationally at times, but neither do many CEOs and other C-level execs who can come to act like incompetent fools more than productive leaders in a billion-dollar company. At this year's Home Depot annual shareholder's meeting, an apology was prof erred for last year's disastrous decision by Nardelli (who was forced out in 2007) and the meeting went on as it should have and on a very careful footing with new CEO Frank Blake at the helm.

The sign of a leader who knows how to handle adversity and conflict is admission, and Blake gave it by admitting last year's meeting was a mistake and by taking the brunt of everything from ensuing questions. But the question remains: why did Nardelli do that last year at all anyway? Was he trying to escape questions on his exorbitant pay package and didn't want to take the heat for Home Depot's sales slowdown? As Nardelli should know by know, when yo go public, you answer to your shareholders or take on the risk of becoming a "politician" who never listens to constituents -- but will always be on the legislature floor to vote on pay raises. Now that I think of it, it's already that way inside some companies.

Home Depot Inc. (NYSE:HD) today reported fourth-quarter results that were in-line with Wall Street's expectations. The bad news is that they weren't very good.

Net income fell 28 percent to $925 million, or 46 cents per share, from $1.3 billion, or 60 cents, the Atlanta-based company said in a statement. Excluding a 4-cent charge related to severance given to former Chief Executive Robert Nardelli, profit was 50 cents. Revenue rose 4 percent to $20.3 billion. Analysts expected profit of 50 cents on sales of $20.8 billion, according to Thomson Financial.

Particularly depressing for Home Depot was the 6.6 percent decline in same-store sales. Total retail sales fell 2 percent to $17.4 billion. HD Supply, which is may be spun off, was the only bright spot. Its sales soared 64 percent to $2.9 billion because of acquisitions.

"Reflecting the challenging housing market, our 2006 retail results were disappointing," said Frank Blake, chairman & CEO. "We may not be able to impact the housing market or general economic conditions, but we know that we can improve our performance relative to our overall market share. That will be a central point of emphasis for us in 2007 and beyond."

The company said it will provide details of its turnaround plan and earnings guidance for next year at its February 28 investors' meeting.

It would have been better for Home Depot to release the earnings at the same time as the investors' meeting. Wall Street shouldn't be kept waiting more than a week to hear how Blake plans to revamp Home Depot.

An article in today's New York Times offers a fairly upbeat view of what Frank Blake, the new chief executive at Home Depot, Inc. (NYSE:HD), is doing to turn around the home improvement behemoth. He is putting the focus back on the customers and trying to undo some of the excess that seems to have occurred under former CEO Robert Nardelli. All in all, it seems like he is moving in the right direction. But I have some concerns about the Husky products that are available exclusively at Home Depot.

Now don't get me wrong, I am not a perpetual Home Depot basher. I love tools -- and they sell tools -- ergo, I love Home Depot. Okay, maybe 'love' is too strong a word, but I have had some positive things to say about the company. Back in November, I noted that my recent experiences have been better and commended an associate who was both extremely knowledgeable and helpful. But a more recent experience has me wondering if Mr. Blake has underlying quality issues that need to be addressed.

A couple of weeks ago I finally worked up the nerve (to tell my wife) that I wanted to buy the 26 gallon Husky air compressor that I had been eying for some time. As usual, she gave me the green light so I headed down to my local Home Depot at first light on a Saturday. I loaded the mammoth box onto a flat bed cart and headed toward the checkout, watching the envious stares of those who weren't also getting a new toy. Unfortunately, that was the last of my good feelings.

Robert Nardelli -- the chairman and CEO of the largest home improvement retail chain in the U.S. -- has resigned both posts as of today, according to several sources. If you own Home Depot Inc. (NYSE:HD) shares, what do you have to say?

Although I don't hold them, I say Nardelli's welcome was way overstayed. It's amazing to me how boards and investors can continue with a CEO who manages to get paid such huge sums of money for performance that is not on par in terms of returns. Nardelli worked for the investor (like all CEOs), but his performance does not look like it. Almost sounds like a government job -- just stick around and grab tons of pay without having a fleeting glance at performance or merit or anything -- except "doing your time."

Did anyone see this coming? Most of the investment community did, I think, as Nardelli has been under fire by what seems like just about every Home Depot investor as well as market pundit during 2006 for receiving such a hefty pay package while his company performance was relatively poor during the same time. Ahem, that generally does not sit well with investors.

In fact, Home Depot's stock performance during Nardelli's six-year tenure was pretty plain and nothing to write home about, but Nardelli took home hundreds of millions in pay and bonuses as a result. Awesome. At this time, Home Depot said Nardelli will be replaced by the company's current vice chairman, Frank Blake.

The world's largest home-improvement retailer, Home Depot Inc. (NYSE:HD), has struggled with apparent sales slowdowns and waning sales forecasts in the middle of a housing bust (of sorts). As a result, HD investor Ralph Whitworth wants independent directors to study "strategic alternatives" and evaluate chief executive Robert Nardelli's performance.

Nardelli has been busted up pretty good recently for taking home lavish amounts of pay at the same time Home Depot's prospects have dwindled in the eyes of many investors. Combine that with gobs of other bad news on the Home Depot front and it comes as no surprise that an independent review of, well, just about everything on the Home Depot executive ladder was called for.

Whitworth is known for pushing changes in companies he invests in, similar to Kirk Kerkorian and his stake in General Motors Corp. (NYSE:GM) among other investments. Whitworth plans to submit a proposal for Home Depot's next shareholder meeting and may even nominate directors at that meeting. According to reports, Home Depot will oppose the plan and meet with Whitworth next year. Get the plastic pitchforks and baby clothes ready...

The Home Depot Inc's (NYSE:HD) CEO Robert Nardelli has been under fire recently for what is considered by many to be an exorbitant pay package. CEOs these days routinely receive millions after millions (even with horrid performance) in pay while constantly battling to run their companies in a fashion that constitutes consistent and growing performance.

A director on Home Depot's board has stated, though, that the Home Depot board has made no decisions yet on what the compensation package for CEO Nardelli should look like. "We are continuing our review and have made no decisions," according to Bonnie Hill, head of Home Depot's leadership-development and compensation committee. The committee will be meeting later this month but may not have completed its study into the CEO's compensation package by then. Don't look for any suggestions for change until 2007.

Nardelli, who is known to run his company like a military establishment, has made enemies of several former managers and employees that state the CEO makes life just too hard to work at Home Depot. Home Depot has thrived under the management style of Nardelli, although that style is wearing quite thin with many employees and managers.

However, the word "thriving" may not sit well with many institutional shareholders, who have been unhappy that Home Depot's share performance has been lackluster in their eyes since Nardelli took the job in December 2000 -- while Nardelli has earned more than $150 million in compensation up to now. If you own HD, is that a nice return on investment?

Home Depot's Board of Directors will soon renovate CEO Bob Nardelli's rather large compensation package. Mr. Nardelli took over as Home Depot CEO in December 2000. His compensation since then has averaged about $50 million per year. When Mr. Nardelli took over, Home Depot stock was at $40.19; and the stock closed at $36.58 on 18 September 2006. During Mr. Nardelli's tenure as CEO, the share price of Lowe's, its main competitor, has gained 178%.

According to Bonnie Hill, Home Depot's compensation committee chair, Mr. Nardelli's pay package will be reconfigured if only to quiet shareholder outrage that the CEO continues to profit handsomely while investors do not. At Home Depot's annual meeting in May, shareholders withheld 30% of their votes, including votes for Mr. Nardelli.

Currently, the bulk of Mr. Nardelli's pay package is tied to the financial performance of Home Depot, NOT stock performance. Fair is fair. On Mr. Nardelli's watch, Home Depot's sales have increased from $45.7 billion in 2000 to $81.5 billion in 2005.

Still trying to recover from self-imposed wounds from the annual meeting debacle, Home Depot senior management is schmoozing with Wall Street as well as investors. CFO Carol Tome presented a version of Home Depot's strategic plan at the recent Goldman Sachs Global Retailing Conference. CEO Bob Nardelli has recently made himself available for media interviews. Bad publicity had reached such high levels that Home Depot did the previously unthinkable. Nardelli called HD founder and huge shareholder (at one point as many as 59 million shares) Bernie Marcus so he could say something nice about Nardelli's job performance. What Marcus said is what everybody but Nardelli already seems to recognize. Customer service is inconsistent at Home Depot stores, often bordering on abysmal. Touting various customer service initiatives such as the $30 million "Orange Juiced" program, or bragging about 5.5 million employee hours in stores for the second half of 2006 are meaningless to customers who cannot get the information and/or products they need when they are standing in the store. Lack of money is not Home Depot's problem. Lack of a customer-centered corporate culture is.

Home Depot senior management is trying to make strategic decisions. Nardelli recently announced that 300 jobs at the Atlanta HQ will be cut. But since it is not clear what those job responsibilities entail, it is equally unclear how this move will help improve the shopping experience for consumers. Recognizing the need to revamp its own corporate culture, Home Depot recently decided not to expand in Europe by acquiring Kingfisher, a UK-based home improvment chain. CEO Nardelli has indicated repeatedly that the SEC investigation into how the company accounts for stock options will have no negative material impact on Home Depot's finances. Home Depot caught a break in Chicago. Mayor Richard Daley vetoed a city council living-wage resolution that would have forced Home Depot, Wal-Mart and Target to pay up to $13 per hour in pay and benefits.

During the month of September, Home Depot intends to provide a national home show in more than 1,000 stores. Celebrities from home improvement shows will lead a number of how-to clinics. Vendors will offer in-store demonstrations of innovative products designed to save money and be energy efficient. There will also be interactive online workshops, and a virtual home tour specifically designed to show case brand new products.