Buffett pushes to protect Wells Fargo stake

Warren Buffett’s Berkshire Hathaway stormed back into court yesterday in a continued effort to upend the government-sanctioned reorganization of crippled mortgage lender ResCap.

The billionaire investor, having already beaten Uncle Sam by gaining court approval to name an independent examiner to probe ResCap’s pre-Chapter 11 settlements, pushed Bankruptcy Judge Martin Glenn to name his firm as the leading bidder for ResCap’s mortgage business.

Buffett failed on that account — although he forced Fortress Investment Group, run by New York hedge fund titan Wes Edens, to up its bid and cut its breakup fee.

The hearing yesterday capped a whirlwind two-day blitz of witnesses, charges and countercharges in Buffett’s full-frontal assault on the government-backed plan to rid itself of ResCap’s toxic mortgages.

The court matter also left some lawyers at the hearing scratching their heads over why Buffett — whose Berkshire conglomerate is not in the mortgage-servicing game — is making such a hard run at the ResCap reorganization.

The only position Buffett holds in ResCap is secured bonds — and he’s already assured of getting paid full face value on that paper.

Some lawyers who were in the courtroom said that Buffett might be making such an intense run at ResCap in order to undo the settlement by Ally with the insurers of ResCap’s soured mortgages.

Ally recently settled with several insurers on a batch of bad mortgages worth $8.7 billion — agreeing to pay them 4 percent of issuance, a source said.

“Ally paid so it did not have to wait years and years” to rid itself of mortgage liability, the source close to the bankruptcy said.

That 4 percent settlement, sources said, is twice as much as defunct Countrywide Financial agreed to pay to settle its toxic mortgage liability.

Buffett, lawyers said, may be looking to protect his huge stake in Wells Fargo and other banks.

Wells Fargo and the other banks have set aside about 2 percent of its toxic mortgage liability.

The lawyers, speaking on background and not on the record during the court hearing, said Wells and the other banks could have to pony up more capital if Ally’s 4 percent settlement became the yardstick for future bank settlements.

Therefore, the lawyers added, Buffett is aggressively pushing to probe ResCap’s pre-Chapter 11 deals — which includes the 4 percent settlement — possibly with an eye toward undoing the Ally settlement and re-settling it closer to 2 percent.

Berkshire Hathaway owns a leading 7.4 percent stake in Wells Fargo, worth $12 billion, and $5 billion in preferred Bank of America shares.

Buffett has personally invested an undisclosed amount in JPMorgan Chase.

In court, a Berkshire lawyer said Buffett is pushing for the examiner because he believes a lower settlement would maximize value for creditors.

Berkshire Hathaway did not return calls.

jkosman@nypost.com

Berkshire Hathaway, Berkshire, Warren Buffett, Bankruptcy Judge Martin Glenn, Fortress Investment Group, mortgage, Wells Fargo online, settlement, Wes Edens, ResCap

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Davis provides Mets offense with grand slam

At 8:37 last night, Ike Davis came to the top step of the Mets’ dugout and waved to the crowd of 29,014 at Citi Field, taking a much needed curtain call.

For the first time all season, Davis could exhale and enjoy the moment.

His sixth-inning grand slam to center field off a first-pitch fastball from Jake Arrieta that landed on the Party City Deck was the hit that Davis and the Mets fans had been waiting for all season. The first grand slam of his career, and first home run of the season at Citi Field, lifted the Mets and the Amazin’ R.A. Dickey to a 5-0 win over the Orioles.

Neil Miller

THAT’S GRAND: Ike Davis of the Mets watches the flight of his grand slam last night at Citi Field.

This was Davis’ first curtain call of his career.

BOX SCORE

“It’s really cool,’’ Davis said later. “I wasn’t expecting it. In the dugout R.A. said, ‘Hey, you’ve got to get out there,’ so he gave me his helmet and I went out there and did it.’’

This grand slam is why Davis was never sent to the minors. This is why manager Terry Collins rode out Hurricane Ike. The Mets have little power as a team. They need Davis to hit home runs. It’s really that simple.

They need Slam City. Davis is one of the few Mets who can supply that kind of power.

“It is nice to hit a home run and you score multiple runs vs. six hits and you score two runs, ’’ Davis said.

Dickey, who fluttered his way to a second straight one-hitter, is magic. The Mets have the oddest of aces, the knuckleballer who cannot be touched. Dickey is 11-1. The Mets own a great 1-2 pitching punch in Dickey and Johan Santana.

What they really need is another big bat to help take the pressure off David Wright. Davis has to be that bat.

“I talked to two managers in the last two series and they asked about Ike,” Collins noted, “and one of the things they brought up is: ‘He still scares us to death when he comes to the plate’ and they know he’s hitting .165. When he gets it going, he’s dangerous, and right now he’s getting it going. When you get the hit to win a game, it’s got to lift your confidence.’’

The home run lifted Davis’ average to .196 and gave him a nine-game hitting streak. He has seven home runs after a tortuous start. The Mets came into the night with only 53 home runs as a team, which ranked 22nd in the majors.

The offense also got a lift from rookie Jordany Valdespin, who doubled and tripled and scored twice as he started at second base in place of Daniel Murphy. Expect Valdespin to be back at second tonight.

Valdespin plays with a certain enthusiasm that has been lacking in this Mets lineup. He just needs to know when to turn it up and when to tone it down.

When Davis came to the plate in the bottom of the eighth, the fans cheered again. There is something about Davis that makes him so likeable. Before the game he took the time to compliment a young reporter on getting a haircut.

That’s Ike. He’s easy to like.

Davis has been through his share of woes this year, including his bout with Valley Fever, but when he took that sixth-inning curtain call, a cloud lifted on his season.

“The fans have been behind me all year, even when I wasn’t doing anything and striking out every at-bat, they still were cheering for me,’’ Davis said

The Mets need Davis and the fans know that.

“It’s easier to play the game when you’re actually doing stuff,’’ Davis added with a smile. “You can’t pout. You are going to go through bad streaks — mine was just longer than anyone would want. I think we’d hit a lot more home runs if we didn’t play in this ballpark. It’s still a big ballpark.’’

Yes, it is. That’s no alibi, that’s Ike being Ike, finally.

kevin.kernan@nypost.com

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Ike Davis, the Mets, Mets, R.A. Dickey, Hurricane Ike, Ike, Jake Arrieta

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Japan Domestic Demand Spurs Recovery

TOKYO—The Bank of Japan said domestic demand rather than overseas exports was the driving force for economic growth for the first time in at least 20 years, as the euro-zone crisis and slow U.S. growth continue to suppress global demand.

The BOJ upgraded its overall assessment of the economy, crediting activity following the March 2011 earthquake and tsunami in northern Japan.

"Japan's economic activity has started picking up moderately as domestic demand remains firm, mainly supported by reconstruction-related demand," the central bank said in its monthly report.

A rise in domestic demand would be a welcome development for the BOJ, because wage growth is seen as the best way to break the long-running deflationary cycle that has seen price rises remain around zero.

Still, the BOJ remains cautious about prospects overseas as the euro-zone crisis sparked by Greece continues to grind away. "There remains a high degree of uncertainty in the global economy," the BOJ said, adding that particular attention should be paid to "developments in global financial markets" amid the European debt crisis.

After the collapse of the asset-inflated bubble in early 1990s, growth in Japan's economy has almost always been driven by its strong exports, as domestic demand largely stagnated. But it appears that things are different this time, as global demand falters amid the euro-zone debt crisis and continued weak growth in the U.S.

More

Ruling Party Divided Over Tax Deal

Domestic demand is being fueled by a total of ¥19 trillion ($240 billion) in public-works spending over the next five years, a key factor in creating a 4.7% annualized growth rate in gross domestic product for the first quarter.

The consensus among private-sector economists is for a slowdown in growth to around 1.9% annually in the April-June period, but they don't see a return to an overall economic contraction. Instead, consumer spending, which accounts for about 60% of the economy, has firmed as people buy eco-friendly and fuel-efficient cars and housing.

Consumers now appear more willing to undertake discretionary spending following self-imposed restraint after last year's disasters.

"There is no doubt that domestic demand is now the key driver," said a person familiar with the BOJ.

Some private-sector economists say the economy could be supported, at least for this year, without a surge in exports. With Japan's long-running deflation, individual wages were stagnant in 2011, falling 0.2% from a year earlier.

"Exports are unlikely to be a factor that drags down the economy," said Akihiko Suzuki, chief economist at Mitsubishi UFJ Research & Consulting. "The focus is on whether or not wages will increase" to facilitate a self-sustainable recovery, he added.

The authorities aren't banking on an "export-free" recovery, saying that the traditional reliance on exports is still a critical factor, representing 15.1% of GDP for the fiscal year ended March.

The central bank sees a rise in exports and production as a precondition for the Japanese economy to embark on a full-blown recovery. "Japan's economy is expected to return to a moderate recovery path as domestic demand remains firm and overseas economies emerge from a period of deceleration," it said.

Write to Tatsuo Ito at tatsuo.ito@dowjones.com

Bank of Japan, Japan, BOJ, domestic demand, overseas exports, global economy, gross domestic product, global demand, Mitsubishi UFJ Research & Consulting, economic growth, debt crisis

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Music heat wave

Ah, sweet summer. It brings back memories of sunburn, sand in your bathing suit and that certain song. Maybe these magazines will mention the tune you will be humming during the next blizzard.

The June edition of Rolling Stone should have been dubbed “the bad boy” issue. It has a disheveled Charlie Sheen on the cover, a Q&A with potty-mouth comedian Louis C.K. and an interview with Jennifer Aniston’s ex, John Mayer, who claims the “womanizer” title is no longer appropriate since he hasn’t had a date in years. The interview is a must-read — not because of his earnest introspection following vocal cord surgery — but for the details of his new life in Montana picking up his beer from the local Albertson’s. While Mayer is busy trying to steer clear of gossip site TMZ, he does a good job of putting the gossip machine into high gear with his views on country music sweetheart Taylor Swift, who famously wrote about their break-up.

Vibe knows what sells, and slaps a “Sexy Issue” banner on its cover. But is that reminder even necessary? Sex and booty banter have always been the guiding principles of the hip-hop magazine. The music reviews, especially when it comes to female artists, seem more focused on a star’s “hotness” than anything else. Still, the issue’s oddball article on how African-Americans get “shafted” in the porn industry threw us for a loop. We’re all for equality, but that would seem to us to be quite a bit further down on the list of priorities.

P-R-E-T-E-N-T-I-O-U-S! Uncut’s cover story on Patti Smith, of G-L-O-R-I-A fame from her 1975 breakthrough album “Horses,” starts by telling us she did not want to discuss her rocker past, just her new record. Not surprisingly, the editors love the record. Unlike its top-40-obsessed peers, Uncut deserves some credit for catering to an older generation while trying to find something interesting in today’s music.

If you thought real rock ’n’ roll was dead a long time ago, Spin says you might want to check out Cuba’s thriving punk and heavy metal scenes. Havana’s tattooed thrashers — who, unlike their US counterparts, may consistently have something obvious to rebel against — include Gorki Aguila. Lyrics like “El Comandante wants me to applaud his bullsh—t sermonizing” got Aguila banned and imprisoned by Castro a couple of times. Elsewhere, we enjoyed the table of ratings for guitar gods, which, for example, gives the “pre-sobriety” Eric Clapton far higher marks than the “post-sobriety” Eric Clapton. The latter ranks just above Jimmy Fallon, Conan O’Brien and “A Guitar Hero master.”

We’re not sure whether or not it says anything about the state of the Big Apple under Mayor Bloomberg, but most of New York’s nine suggestions for cooling off in the water this summer take place in one of two places: on the street or on the roof — and yes, there does seem to be a pattern here. If you’re not out chartering a yacht in Montauk (suggestion No. 7), you are advised to order bottle service at the rooftop deck of the Gansevoort Hotel or, if you can manage it, rent a rooftop “beach cabana” at the Dream Downtown in Chelsea ($1,500 a day). But if you fall into the other category of customer, you are invited to check out the public pool, a neighborhood fire hydrant or the boardwalk at Coney Island alongside “the seething mass of humanity.” Or, perhaps most fittingly, strip yourself down to your last assets for a jaunt on the nude beach at Sandy Hook.

The New Yorker has awakened to the crisis in publishing that’s being created by Eric Holder’s chuckleheaded pursuit of an antitrust case against Apple over e-books. While the president’s prosecutor-in-chief frets over the price of book downloads like it’s a question of national security, Amazon CEO Jeff Bezos’ price-slashing dominance — an actual, real-live antitrust issue — is poised to kill the book industry as we know it. Amazon is “focused on customers, not competitors,” a Seattle exec says, which is a “peculiar way of describing your suppliers,” media reporter Ken Auletta notes. It’s also a typically absurd rhetorical flourish from Amazon, as if editors and presses have never been anything more than pesky middlemen getting in the way of the public’s thirst for cheap, mediocre reading.

Whenever Time runs a cover story about an afflicted group — war refugees, political prisoners, underwater homeowners — it seems unable to resist the urge to collect pages and pages of chiaroscuro close-up photos of its subjects, wearing grim, weathered, determined faces. This week, undocumented immigrants are given the treatment. “It’s recognizing people’s existence, that they are people, not abstract numbers,” according to photographer Gian Paul Lozza. Maybe a while back, years or decades ago, before Time had done this dozens and dozens of times. Now, however, it could be said that the deluge of sullen portraiture is so plentiful that it flirts with commoditization. On top of it all, we must confess we’re feeling a little browbeaten.

John Mayer, Eric Clapton, Charlie Sheen, Taylor Swift, Louis C.K., cover story, cover story, Patti Smith, Amazon

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MarShon looking ahead

The Nets may not have a full team yet, but MarShon Brooks is working hard on improving his game this offseason.

While both Deron Williams and Gerald Wallace are expected to test the free-agent market this summer, Brooks is prepping for his second season with the Nets whether or not Williams and Wallace make the move to Brooklyn.

“We don’t really have a team right now,” Brooks told The Post. “I’m just working as hard as I possibly can to be ready for whatever role they give me. I’ve been doing a lot of lifting, trying to get stronger. I think that will help me with my defense, my long range shot.”

Brooks admitted he doesn’t have any inkling what the two All-Star free agents will do when the free-agent signing period begins July 1.

“I haven’t talked to Gerald in a while, but [Deron Williams] he’s still around lifting and things like that at the practice facility,” Brooks said at a Sprint NBA Nation event at South Street Seaport. “[Deron] is a tough guy to read. I really can’t control [whether or not they come back], that’s between them, their family and their agent.”

NETS' FREE-AGENT TRACKER

In his rookie season, Brooks averaged 12.6 points, 3.6 rebounds and 2.3 steals in 56 games and was named to the league’s All-Rookie second team. He credited the veteran leadership of Williams and Wallace as part of the reason he has experienced success early on in his NBA career.

“Of course I would like to see them come back,” Brooks said. “[They mean] everything. They taught me how to handle myself. Deron, at the beginning of training camp, always looked at me as a talented scorer but I didn’t always make the right play. I had the opportunity to watch him, see him make the right play every time, learn defenses, see where the help is coming from.”

Playing in his first season in the NBA was not a simple task for Brooks, who was unable to maintain his workout schedule as nagging injuries built up throughout the lockout-shortened season. Brooks plans to change that and hopes to benefit from a more traditional training camp.

“I think last year one of the things that happened to me, during such a tight schedule, I wasn’t really able to lift and maintain my body mass like I wanted to and you know the little nagging injuries that you have they had a real big influence on the game,” he said. “I’m looking to come into training camp in the best shape possible and lead the team.”

The on-court improvement is not the only thing Brooks is looking forward to next season. The former first-round pick is excited to move into New York and about the support fans are showing the fans are showing for the team.

“It’s really surprising to see so many Brooklyn Nets hats already,” he said. “There’s a great fan base and it’s New York. You can’t do much better than New York. It’s exciting.”

Brooks also expects the Knicks-Nets rivalry to be at an all-time high next season.

“It’s going to be crazy,” Brooks said. “It was already crazy right across the river, but I feel like it’s territorial at this point. They’ve been in New York, we’re coming to New York. We’re the newcomers.”

asulla-heffinger@nypost.com

Deron Williams, Williams, Gerald Wallace, MarShon Brooks, The Nets, Nets, NBA, New York, Brooklyn Nets

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Conditional viewpoint

TechStars, an NYC-based tech incubator, recently unveiled its new crop of innovating companies.

Particularly intriguing was Condition One’s technology for iPhones and iPads.

While watching a video, if you move your device up, down, left or right, the camera angle changes to reflect that movement.

Condition One hopes to have a consumer version of the program out by year’s end.

incubator, technology, ebook download

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Verdict will move defendants to seek deals

John Crudele

Who’s next?

If you are employed on Wall Street and happen to be dishonest, then you are probably pretty nervous right now after the quick-decision conviction of former Goldman Sachs director Rajat Gupta for insider trading.

By someone else’s count there are 120 cases of insider trading pending around the country, many in the jurisdiction of Manhattan US Attorney Preet Bharara, who prosecuted both Gupta and his pal, Raj Rajaratnam.

Rajaratnam was convicted of getting tips from Gupta. Raj made millions, while Rajat scored brownie points with his friend, who was the head of the Galleon hedge fund. Raj is serving his 11-year sentence in a federal prison in Massachusetts. Now, Rajat will also be imprisoned.

You can expect many of those 120 other defendants to now seek deals. The mood in America today is decidedly anti-Wall Street, and anyone foolish enough to take his case to trial will not only face huge legal fees but also juries that simply aren’t very sympathetic.

Gupta didn’t have a chance. Even if the handsome, sophisticated and rich 63-year-old former head of McKinsey & Co. had testified on his own behalf, jurors are no longer swayed by the argument that it was illogical for someone like Gupta to have cheated to make money he didn’t need.

Americans have experienced Wall Street greed firsthand and none of the financial crimes we’ve seen over the past many years are very logical.

Gupta faces a possible 25 years in prison. In all likelihood, Judge Jed Rakoff, who defended inside traders when he was a lawyer, will sentence Gupta to less than the maximum. Rakoff, according to a former prosecutor I know, is known for giving sentences below the federal guidelines.

Even so, Gupta will likely be imprisoned right after he is sentenced, even if he decides to appeal. That could be the end of it, except that Gupta has one card he could play.

As a director of Goldman, Gupta was a fly on the boardroom wall at a time of chaos in the financial markets. He could easily snitch about what that company was up to and win himself a handsome reward — part of his life back.

It’s possible that Goldman did nothing wrong, in which case the card Gupta is holding is really a joker. But federal investigators are actively looking into Goldman’s actions during the 2007 and 2008 financial crisis. And until that investigation is complete, Gupta’s card is aces.

Gupta had better hope he can barter information that investigators consider valuable for precious time off his sentence.

Gupta could soon be the one deciding who is next.

john.crudele@nypost.com

Goldman Sachs director Rajat Gupta, Raj Rajaratnam.Rajaratnam, Manhattan US Attorney Preet Bharara, insider trading, Wall Street, federal prison

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