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December 2, 2008 8:56:54 PM CST

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AIG Credit Rating Cut Triggers Mad Dash for Cash

Posted Sep 16, 08 1:35 AM CDT in World,  Business 

(Newser) – Insurance giant AIG teetered on the brink of catastrophe last night as ratings agencies downgraded the beleaguered firm's credit ratings, forcing it to raise $14.5 billion to meet debt obligations, reports the Wall Street Journal. Federal Reserve officials were holding emergency talks with Goldman Sachs and JPMorgan Chase in an effort to assemble a $75 billion line of credit to avert a crisis.

If the firm doesn't secure financing by tomorrow, it may be forced to declare bankruptcy. "The situation is dire," said a source close to AIG. The latest financial disaster if bound to exacerbate a mounting worldwide economic calamity, and severely tests government abilities to contain it.

Sources Wall Street Journal, New York Times

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AIG Tower is seen in Hong Kong today.   (AP Photo/Kin Cheung)
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