Buffet, Derivatives and Financial Weapons of Mass Destruction

Mr. Buffet has called derivatives "financial weapons of mass destruction". As we survey the first financial crisis since he made his remarks, it isn't derivatives which are at fault. Rather, it is one of Mr Buffet's companies.

It is ironic that Mr. Buffet has been a large shareholder in Moodys which, along with the other credit "agencies", is at the center of and responsible for the current credit crisis via their at best faulty credit analysis (at worst fraudulent). Who would have owned the CDOs that were rated AAA and AA had they not been so rated? How much less would have been produced? We will never know but as we observe the worldwide propensity to hold these instruments just because of their rating (which was even true for financial market participants like Citi), it's hard to believe that the market wasn't created by the rating agencies.