Private equity giant KKR & Co. (NYSE: KFN) posted a $1.2 billion loss last year -- compared to pretax net income of $815 million the year before. This is KKR's first loss in at least five years.

Bloomberg pins the blame on a drop-off in leveraged buyout transactions. A $1.4 trillion market in 2006 and 2007, only $212 billion was spent on takeovers last year, which was bound to put a dent in KKR's top and bottom lines.

This post is part of our Money Face-Offs feature. Let us know who you think comes out ahead in this head-to-head match-up, and check out our other Money Face-Off posts.

Stephen A. Schwarzman, co-founder of the Blackstone Group vs. Henry Kravis, co-founder of KKR. A showdown so delicious, it's already been immortalized on Page Six -- Schwarzman calls Kravis a "one-trick pony," Kravis calls Schwarzman "the poster boy for greed." Who is more arrogant? More eccentric? Richer? Only the planners of their lavish parties can tell ...

The two have been in a high-stakes tennis match of sorts for years in every financially-oriented aspect of their lives, starting with the companies they target, continuing through their more personal acquisitions and not even ending in their contributions to charity.

Nope. In the world of private equity, KKR had always been the hugest, the most storied, the most secret and powerful. KKR was responsible for the 1988 leveraged buyout of RJR Nabisco, inspiration for thousands of MBAs, as well as a book and a movie. Not many financial deals have inspired so much as a little sonnet, but this, this was the stuff of legend.

Part of that legend? Kravis' formidable ego.