May 3 (Bloomberg) -- Billionaire investor Warren Buffett said Berkshire Hathaway Inc.'s ownership of almost 20 percent of ratings firm Moody's Corp. poses no conflict with his company's municipal bond insurance business.

``It would be wrong if we tried to pressure Moody's but that's never happened,'' Buffett said today in an interview with Bloomberg Television in Omaha, Nebraska, where his Berkshire is based. ``I have no contact with the management of Moody's. I can't recall ever calling them in my life.''

Berkshire's relationship with Moody's drew scrutiny this week from Connecticut Attorney General Richard Blumenthal after Moody's gave four-month-old bond insurer Berkshire Hathaway Assurance Corp. its top rating. A favorable Moody's rating for Berkshire or a lower rating for a competitor could give Buffett's firm an advantage. The arrangement was a ``clear and direct conflict of interest,'' Blumenthal said.

Berkshire is ``a passive investor that has never contacted us regarding our ratings,'' said Tony Mirenda, a spokesman for Moody's, in an interview this week. ``We have a longstanding policy of not discussing our ratings with shareholders and non- employee members of the board of directors.''

Buffett and his insurance lieutenant, Ajit Jain, started the bond insurance company to compete with existing guarantors struggling to maintain their ratings. Standard & Poor's, a unit of McGraw-Hill Cos., also gave its highest grade to the Berkshire unit, which offers municipal bondholders protection from default by state and local governments.
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May 7 (Bloomberg) -- In the course of a three-and-a-half- hour dinner at Manhattan's Smith & Wollensky steakhouse, Emil Assentato went from also-ran to the top of the world's fastest- growing credit market.

By the end of the meal, Assentato, 58, the head of Cie. Financiere Tradition's North American securities business who races cars on weekends, had persuaded more than a dozen credit- derivatives brokers led by Donald Fewer and Michael Babcock to defect from rival GFI Group Inc., court documents allege. In the end, 21 would leave for Tradition with the promise of $130 million over three to five years, about $6 million apiece.

Tradition's attack did more than decimate GFI's credit-default swap desk. It also raised the bar for the ``extraordinary'' pay commanded by derivatives brokers who match buyers and sellers between banks, according to affidavits filed by New York-based GFI in a suit against Tradition. As Wall Street buckles under the biggest credit-market losses in history, brokerage firms are seeking to tap the $10 billion of fees generated by middlemen, who spend as much as $500 million a year entertaining traders with strippers, football games and evenings at trendy Manhattan bars, based on court records and interviews with industry officials.

``It's astounding that people get paid that much to be intermediaries,'' said William Cohan, a former investment banker with Lazard Ltd. in New York and now an author of books on Wall Street.

So-called interdealer brokers pair bids and offers between the world's largest banks in derivatives markets that have no public exchanges such as credit-default swaps and interest-rate products. Unlike traders and investment bankers, the brokers don't take on risk or devise trading strategies for their clients.
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