No taking stocK

Still bruised from his fight with the Securities and Exchange Commission, hedge- fund billionaire Phil Falcone faces a new battle — this time over the crown jewel of his troubled empire.

Disgruntled investors of Falcone's hedge fund, Harbinger Capital, are eyeing his successful publicly traded entity, Harbinger Group, as a potential gold mine, The Post has learned.

Harbinger, a holding company that trades on the New York Stock Exchange, owns a portfolio of companies, including Spectrum Brands, the maker of Rayovac batteries, and lingerie retailer Frederick's of Hollywood.

The Harbinger hedge fund and Falcone collectively control about 70 percent of Harbinger Group's stock.

The upset fund investors, in the wake of Falcone's settlement with the SEC — which calls for the liquidation of fund assets— are unlikely to be satisfied with Harbinger Group stock.

The shares of Falcone's publicly traded entity are undervalued and will shortchange them, some investors said.

Instead, the hedge-fund investors are eyeing the holding company's assets, which they estimate are worth a lot more than the company's $1.3 billion market cap.

The investors plan to press Falcone to sell off Harbinger Group's assets, believing they will fetch more at auction than the price of the sagging stock.

If they don't get their way, they could sue, according to one source.

Harbinger Group investors agree that the stock is cheap. The shares rose 2.6 percent yesterday to close at $9.17.

"We think the company is worth ... more than where it is trading," said one investor, adding that the annuity business alone is worth more than $1 billion. "It should be trading around $12 per share."

With his hedge fund on the rocks, Falcone is focused on growing the publicly traded Harbinger Group and is likely to resist breaking it up and selling off pieces.

A spokesman for Harbinger Capital declined to comment. But a source close to the firm said executives plan to address the hedge fund's investment in Harbinger Group soon.

Harbinger Capital "will continue to explore all options with the objective of maximizing value for those investors that redeemed as well as those that want to remain as investors," one hedge official told The Post.

Falcone and Harbinger Capital agreed to pay $18 million to settle accusations that he put his "lavish lifestyle" ahead of investors, including taking out a $113 million personal loan to pay taxes.

kwhitehouse@nypost.com

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Home Depot gets boo$t

A recovery in the US housing market helped boost Home Depot's quarterly profit and sales above analysts' estimates, prompting the world's largest home improvement chain to raise its outlook for the year.

The retailer also reported its first double-digit rise since 1999 in sales at stores open at least a year and had the highest quarterly transaction count in its history.

Home Depot shares closed down 1.2 percent yesterday to $74.29.

Copyright 2013 Thomson Reuters. Click For Restrictions

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Ackman digs in at Herbalife

Bill Ackman's Pershing Square hedge fund — now almost $300 million in the hole on his $1 billion short bet against Herbalife — is digging in.

The activist investor has made "material progress" in attracting federal, state and international regulatory interest in the company he believes is a pyramid scheme, Pershing Square investors were told in a letter highlighting the fund's second-quarter performance.

"We are not at liberty to disclose the nature of those developments, but we believe that the probability of timely aggressive regulatory intervention has increased materially," he said in the private letter, a copy of which was obtained by The Post.

BILL ACKMAN
Nutritional focus.

The 23-page letter, written after an ugly public battle with another big investment, JCPenney, led the 47-year-old New York hedge-fund titan to resign from its board last week, started with the admission, "we are going to make mistakes."

Los Angeles-based Herbalife has strongly denied Ackman's charges. Its shares are up nearly 100 percent since Ackman made his complaints public last December.

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Weinstein lifts ’Flix

Netflix, the largest subscription streaming service, rose to the highest in more than two years after signing a multiyear accord for exclusive rights to movies from the Weinstein Co.

Netflix obtained exclusive pay-television rights to Weinstein and Dimension films starting with pictures released in theaters in 2016, the companies said. Other terms weren't released.

Netflix gained 5.2 percent to $273.29.

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B&N: No Nook to hide in

The ugly decline of Barnes & Noble will remain a public spectacle on Wall Street.

Chairman Len Riggio said yesterday he has dropped his bid to take the struggling bookseller private — an announcement that, along with a wider-than-expected quarterly loss — sent the stock plummeting.

Shares of the retailer lost $2.06, or 12.4 percent, to close at $14.61.

"While I reserve the right to pursue an offer in the future, I believe it is in the company's best interests to focus on the business at hand," said Riggio, who in February had disclosed an interest in acquiring the 675-store chain.

B&N has a full plate, as its money-losing Nook tablet also has failed to find a buyer following last month's departure of former CEO William Lynch.

Yesterday, B&N execs blamed the Nook's hundreds of millions in losses partly on overly optimistic business forecasts.

While B&N's color Nook tablet has gone extinct, the company will continue to sell e-readers. But recently B&N has been forced to slash prices on lower-end models amid skimpy sales.

In the fiscal first quarter, B&N said Nook sales slid 20 percent, versus the company's overall revenue decline of 8.5 percent to $1.33 billion.

jcovert@nypost.com

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Obama in NY

This week President Obama will swing through upstate New York to push his "grand bargain" for the middle class. The question is: Will he embarrass Gov. Cuomo?

We don't mean deliberately. But in his speeches calling for a new deal for America's middle class, Obama has touted the boom in US natural-gas production — the result of the rapid spread of hydraulic fracturing, or fracking, to tap gas reserves.

Today, says Obama, "we produce more natural gas than any country on earth." Indeed, new Energy Information Administration figures show gas reserves soaring 10 percent from 2010 to 2011 alone, shattering records. Obama also notes how he's pushed to accelerate America's "natural-gas revolution," though he blames Republicans for blocking him.

AP

Barack Obama

Give the president credit: He obviously recognizes the economic benefits of fracking. And if anyone could use the jobs and revenue that fracking brings, it's the people of upstate New York.

The president's trip will take him to Buffalo, Binghamton, Syracuse and other parts of upstate. These areas have hemorrhaged jobs for years. Today, large swaths are economic basket cases. Upstate job growth over the past year, 0.9 percent, was less than half the national rate, 2.1 percent. Counties such as Steuben and Chemung are stuck with unemployment rates of more than 8 percent; St. Lawrence, Oswego and Lawrence top 9 percent.

The governor knows how bleak the situation is for upstaters. Recently, he defined it as the place "where the problem is." Yet Cuomo continues to keep upstaters out of fracking, even as border towns in neighboring Pennsylvania are benefiting from the natural-gas boom the president has been bragging about and touting (rightly) as a huge benefit for the middle class.

We're with President Obama on this one. And we'll be giving his remarks a close read to see whether he sticks to his line about natural gas — or takes them out to spare the feelings of his fellow Democrat and host, Andrew Cuomo.

Have an opinion on this Post editorial? Send it in to LETTERS@NYPOST.COM!

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It’s not about Israel

Benjamin Netanyahu delivered an obvious but oft-denied truth about the Middle East: It ain't all Israel's fault. During a visit from UN Secretary-General Ban Ki-Moon, Israel's prime minister put it this way:

"I think today everybody understands that the root cause of the instability in the Middle East and beyond has to do with the convulsion that is historic and cultural in nature — of which the Israeli-Palestinian conflict is merely one of many, many such manifestations."

Talk about an understatement. Here's what we see around the region:

* In Egypt, hundreds have been killed in the few weeks since President Mohammed Morsi was deposed in a fight over whether Egypt's future will be secular or Islamist.

Reuters

A girl in eastern Syria crying at the damage done by an air raid by gov't forces

* In Syria, tens of thousands have died in a civil war between dictator Bashar al-Assad and an opposition that includes everyone from democrats to Islamists.

* In Iraq, with America now gone, Sunni-Shiite violence — sparked by a resurgent Al Qaeda in Iraq — has flared anew. More than 1,000 were killed in July alone — the highest one-month total since 2008.

* And in Iran, Mahmoud Ahmadinejad is out, succeeded by "elected" Hassan Rouhani. But the nation remains on the path to becoming a nuclear power, and still sows terrorism through proxies such as Hezbollah.

So with Prime Minister Netanyahu, we'd just say it's a long time the world retired the myth that Israel is the root cause of all the misery and fighting in the Middle East.

Have an opinion on this Post editorial? Send it in to LETTERS@NYPOST.COM!

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Grading teacher colleges

Whether it's the batting average for a pro baseball player, the stars Michelin awards restaurants or the price/earnings ratio of a company's stock — people insist on good ratings to evaluate performance. Now the city is doing the same for teacher colleges.

It's about time.

The city Department of Education just released a new scorecard. In its own words, it measures "the performance of new teachers from 2008-12 of the 12 education programs that supplied the most educators" to our public schools. Since a good teacher in the classroom is arguably the single most important factor in student performance, we're not going to get better performance out of our students until we are first sure our teachers measure up.

It's no secret that the traditional education degrees at many colleges are mediocre. But the city's scorecard shows that when it comes to improving student test scores, even an elite university such as Columbia had 20 percent not as effective as they should be. The comparative figure for City College of New York, another big supplier of teachers, was 10 percent.

No doubt people will argue about what these measures tell us and what they don't. Just as a batting average doesn't tell you all you need to know about a baseball player, the scores on these performance measures may not be the whole story. But the way to get a fuller picture isn't to lose these meassures, but to get more of them.

In particular, we're looking forward to next year, when the state will have more rigorous standards in place — and those measures will include teachers from innovative programs such as Teach for America. The good ones should welcome the competition.

Have an opinion on this Post editorial? Send it in to LETTERS@NYPOST.COM!

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De Blasio: A vote for status quo

The Issue: Bill de Blasio's ideas for closing the gap between the rich and the poor in New York City.

***

If Bill de Blasio gets his way, a large number of the "rich" will move out of New York City, commute to their jobs and pay no New York City income tax, rather than pay more than they currently do as residents ("De Blasio's New Yorks," Editorial, Aug. 16).

The net effect will be to reduce the total amount of money these folks pay as a group in NYC income tax.

Steve Becker

East Meadow

A guy who can't do any better than blatantly copy the campaign message of someone as despicable as John "A Tale of Two Americas" Edwards is leading among Democrat candidates for mayor of New York.

How pathetic is that?

John Michael Casteel

Traverse City, Mich.

As a liberal who subscribes to The Post, I commend you on the exact wordage used in your editorial.

If the right spoke so eloquently more often, more liberals like this 1-percenter would agree with you, and not the lefties I associate with.

Thank you and keep writing this way. I will now talk the talk with my colleagues.

Charles Lipton

Manhattan

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The massacre in Egypt: Blame the brotherhood

The Issue: Whether the bloodshed in Cairo can be blamed on supporters of ousted President Morsi.

***

Unfortunately, Ralph Peters tells it like it is ("This Blood Is on the Hands of Muslim Brotherhood," Aug. 15).

Certainly, the Muslim Brotherhood hasn't suddenly morphed into a peaceful, tolerant organization, but continues its murderous ways in an effort to control Egypt, destroy the Coptic community and impose Sharia law that forbids the presence of other religions.

In 1978, under Jimmy Carter, we made the mistake of supporting radical Islam, and the result haunts us to this day with an Iran that threatens not only our allies, but our citizens, wherever they may be.

AP

Mohammed Morsi

Nelson Marans

Silver Spring, Md.

Thanks to Peters and The Post for getting it right on the military vs. Muslim Brotherhood battle in Egypt.

I read The New York Times' editorial on the subject, and it gave the opposite opinion on the carnage, which matches the Obama administration's floundering.

It is sad that so many Americans are misled.

Massacres occur everywhere throughout the Middle East and Africa, but Secretary of State John Kerry and President Obama seem unwilling or unable to deal with the outcome of the Arab Spring.

Instead, America's leaders put pressure on their only ally in the Middle East, Israel, to give "goodwill gestures" to those committed to Israel's destruction.

Peters reminds us that it is the same Islamist fanaticism that is the "enemy of the Egyptian people and the American people."

Mohammed Morsi is the Muslim Brotherhood and his supporters are ready to die for Islam, so it is any wonder that the number of dead is so high?

Helen Freedman

Manhattan

Our president has recognized the suffering of the Muslim Brotherhood as it defies and attacks its government.

But he does not recognize the evil they do.

Egypt's Gen. Abdel Fattah el-Sisi has witnessed his troops murdered by the Brotherhood recently, and yet our president does not see this as wrong. Obama can only criticize the deaths of Brotherhood insurgents who oppose Egypt's current government.

If we are going to "meddle into other people's affairs," as he has said, then let us support the cause of those who seek to stabilize a nation.

Carol Fineblum

Needham, Mass.

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