I'll update with reactions in a few minutes ...
6:27pm PST: At Doug Ross, "He's Historic, Alright: Standard & Poor's Downgrades US Debt to AA+." And a Memeorandum thread.
6:51pm PST: An analysis at Wall Street Journal, "S&P Downgrades U.S. Credit Rating":
WASHINGTON—A cornerstone of the global financial system was shaken Friday when officials at ratings firm Standard & Poor's said U.S. Treasury debt no longer deserved to be considered among the safest investments in the world.Liechtenstein! I don't believe it!
S&P removed for the first time the triple-A rating the U.S. has held for 70 years, saying the budget deal recently brokered in Washington didn't do enough to address the gloomy long-term picture for America's finances. It downgraded U.S. debt to AA+, a score that ranks below Liechtenstein and on par with Belgium and New Zealand.
The unprecedented move came after several hours of high-stakes drama. It began in the morning, when word leaked that a downgrade was imminent and stocks tumbled sharply. Around 1:30 p.m., S&P officials notified the Treasury Department they planned to downgrade U.S. debt, and presented the government with their findings. But Treasury officials noticed a $2 trillion error in S&P's math that delayed an announcement for several hours. S&P officials decided to move ahead anyway, and after 8 p.m. they made their downgrade official.
8:12pm PST: At Zero Hedge, "S&P Downgrades US To AA+, Outlook Negative - Full Text."