AAA over

The credit rating agency Standard & Poor’s has stripped the US of its top-notch AAA credit rating, downgrading it to AA+ and warning of further future downgrades because of political and economic uncertainty. The humbling downgrade of the world’s economic superpower came late on Friday night, after news surfaced of a furious rearguard attempt by the White House to convince S&P that its figures were faulty. Remarkably, there was no immediate reaction from the White House after the downgrade was made public. But the Treasury attacked S&P’s calculations, saying: “A judgment flawed by a $2tn error speaks for itself”. The justification used by S&P – blaming the dysfunctional US political system for being unable to make significant fiscal reform – will set off another debate about US government spending and the shambolic process to raise the debt ceiling that ended earlier in the week. In particular, the news may force Republicans in Congress to reconsider measures to raise revenue – and strengthens President Obama’s hand in any plans to allow the Bush-era tax cuts to expire, raising an additional $3tn over the next decade. – the Guardian

Credit ratings agency Standard and Poor’s said early on Saturday morning they had downgraded the country from its top AAA rating to AA+. The loss of the rating could reignite panic on the markets as traders worry that the world’s biggest economy may be leading the way back into recession. Markets around the globe suffered huge falls this week, but the US Dow Jones ended higher on Friday after better-than-expected jobs growth figures. In London, the FTSE 100 index of leading UK shares closed the day at 5246.99, down 146 points or 2.71%. More than £148bn has been wiped off the FTSE’s value since trading opened on Monday – a plunge of 568.2 points or 10.15% – caused by the eurozone debt crisis and fears the economy is stalling. In other European markets, Germany’s DAX ended Friday down 2.8% and the CAC in France fell 1.2%. Italy was 1.7% lower and Spain dipped by 0.2%. – Sky News

Dave, Nick and George stay on holiday as markets crumble

Stock markets around the globe may be in crisis but the three most senior politicians in the UK are away on holiday. Foreign Secretary William Hague yesterday insisted the Government was still “fully functioning” as he chaired an urgent meeting in central London on the economic crisis. Mr Hague is the most senior Cabinet minister remaining in the UK, while the Prime Minister David Cameron holidays in Tuscany, Chancellor George Osborne is in the United States, and Deputy Prime Minister Nick Clegg is in France. Unlike in previous crises, there was “a gaping hole where British leadership should be” with the UK Government “absent from the global economic debate at this critical time”, said Ed Balls. – Belfast Telegraph

May overrules Cam on Met chief

David Cameron wanted a former American “supercop” to become Metropolitan Police Commissioner but was overruled by Theresa May, the Home Secretary, The Daily Telegraph can disclose. The move followed the resignation of Sir Paul Stephenson, the head of Scotland Yard, last month amid the phone hacking scandal. It is understood that Downing Street informally sounded out Bill Bratton, the former New York and Los Angeles police chief, to see if he would be interested in taking the country’s most senior policing job. But Mrs May was uncomfortable with the idea, which would have ripped up the centuries-old tradition of British citizens serving in the police. Any immediate move was effectively blocked when an advertisement for the post was issued by the Home Office that specified that “applicants must be British citizens”. – Daily Telegraph

Borrow books from your supermarket

Shoppers may soon be choosing their library books alongside baked beans and tea bags. Supermarkets are being invited to offer any spare room to public libraries in an attempt to save money and attract more borrowers. The proposal is included in a blueprint of ideas to help libraries survive, unveiled today by the Local Government Association and the Museums, Libraries and Archives Council. Bradford Council is already set to try self-service “book-borrowing points” in shops across the city for people use. Some libraries could be moved into retail stores with excess space. Another option is to run libraries in partnership with the private sector, charities and other councils. – Daily Express

Cam’s links to Bombardier rival

One of David Cameron’s top advisers was yesterday accused of helping Bombardier’s rival win the Thameslink rail contract. Michael Queen is among the Prime Minister’s cosy inner circle of economic experts. But he is also chief of Europe’s biggest buyout firm 3i group, which was involved in German firm Siemens securing the £1.4billion deal to build carriages for the Brighton to Bedford line. The decision was a devastating blow to Bombardier and triggered the loss of 1,400 jobs – with thousands more at risk. It also emerged yesterday the chairman of 3i is Sir Adrian Montague, once dubbed the “government’s favourite fixer”, who is close to the Coalition too. The revelations yesterday prompted MPs, union leaders and workers to demand an independent review of the whole Thameslink tendering process. – Daily Mirror