INSTANT VIEW: Moody's strips Berkshire of top credit rating

NEW YORK (Reuters) - Moody's Investors Service on Wednesday cut its rating on the debt of Berkshire Hathaway, the holding company of legendary investor Warren Buffett, from its top Aaa to Aa2, the third-highest investment grade.

Moody's, which also cut its rating on National Indemnity Corp and other major Berkshire Hathaway insurance units, cited the impact on the holding company's key businesses of the severe decline in the equity markets over the past year.

The following is reaction from industry analysts and investors:

WHITNEY TILSON, MANAGING PARTNER, T2 PARTNERS LLC, NEW YORK

"Why anyone pays any attention to ratings agencies anymore is beyond me-- they have been so spectacularly wrong on any financial related company in the past year or two."

"It's our largest position-- we're not bothered by it because people need to buy insurance and everyone knows that Berkshire Hathaway in a turbulent market is more likely to pay than any other insurer, by far"

"Berkshire Hathaway remains the Fort Knox of insurance regardless of Moody's rating."

MATT MCCORMICK, BANKING ANALYST AND PORTFOLIO MANAGER AT BAHL & GAYNOR INVESTMENT COUNSEL, CINCINNATI

"Even Warren Buffett cannot escape the wrath of the financial meltdown.

"People who own Berkshire Hathaway are buying the stock for Warren Buffett, not for some analysts' short term upgrade or downgrade view -- Buffett is not losing any sleep over this."

"He has knack for holding on when others sell and buying when others are sitting it out - ultimately it's best to follow his long term approach."

MICHAEL HOLLAND, HEAD OF NEW YORK INVESTMENT FIRM HOLLAND & CO., WHICH HOLDS BERKSHIRE SHARES

"This has been the most critical financial environment of our lifetimes. Any financial company, including Warren Buffett's, has been affected by it. Moody's is saying it is so long after the fact.

"Warren has been able to use a cash horde, one of the largest in the world, to take advantage of the problems going on now. I see them in the same league as Johnson & Johnson or Microsoft. They are Darwinian survivors.

"He didn't predict the crisis but he prepared his company for it with a fortress balance sheet. Now the guy gets a downgrade. I'm not casting aspersions at Moody's, but its an ironic moment."

"I consider this yet one more example of the barn door closing after the horse is gone. The challenges that all financial companies are experiencing -- and this is a financial company. But not being AAA-rated at Moody's to me is at most relevant."

RICHARD SICHEL, CHIEF INVESTMENT OFFICER OF PHILADELPHIA TRUST CO

"It's a sign of the times."

"When it comes to credit quality, we can't be surprised at this point."

"The (rating) is still higher than just about any company in the country so I don't think it's cause for too much concern."

SEAN EGAN, MANAGING DIRECTOR AND PRINCIPAL OF EGAN-JONES RATINGS CO, IN HAVERFORD, PENNSYLVANIA

"Moody's and S&P are so concerned about losing their franchise that they are acting in ways that they normally would not. Berkshire owns about 20 percent of Moody's. Next week, there will be a meeting at the SEC regarding the ratings industry. The timing of this probably is not coincidental. Moody's needs some cover. It needs to show it's being tough on a company that owns a substantial stake.

"Moody's is taking preemptive action. We think the Moody's downgrade is not a major move. It won't cost them a lot of business. We rate them at "AA-plus," and we'll probably take down ourselves to "AA" to "AA-minus."

"Berkshire is at the top of the heap as far as insurance companies are concerned. It has a significant amount of financial strength. It's been well managed, and hasn't taken on some of the stupid risk that other insurance companies have."

DONALD LIGHT, AN ANLYST WITH CELENT IN SAN FRANCISCO

"This reflects that Berkshire is a holding company with insurance and non-insurance entities. Insurance as an industry has been hurting, and in the non-insurance is a lot of consumer businesses that are going to feel the affects of the downturn as well."

"Bets that Buffett has made on derivatives, although long term, also don't look good right now. He's basically flailing in the same waters as everyone else. This is an affirmation that he doesn't have any way to hover over the troubled waters that everyone else is trying to navigate."

"Buffett has been able to trade on his reputation, which in many ways is well deserved, but the global economic reality that has caught everyone else is now getting him."

(Reporting by Phil Wahba, Joseph Giannone, Lilla Zuill, Dan Wilchins and Leah Schnurr)