Galdalf is using the two different flames to contrast the goodness and badness of himself and the Balrog. Gandalf serves the secret fire, which may be understood to be God or the "life spirit" that God put into the world (I mean that in the most metaphorical way, far removed from any "new age" concepts), and he wields the flame of Anor, which is the Sun and Good. By contrast, the Balrog is a flame of Udun, which is the home of Morgoth, the Black Enemy, Hell.
Gandalf serves and wields the flame of God, the Balrog is a flame of Hell.
That both descriptions have to do with fire serves to show that both creatures, the Balrog and Gandalf are in origin the same sort, angelic beings created to serve greater angelic beings, but the one is fallen and the other is not.
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What's a burrahobbit got to do with my pocket, anyways?
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