Could Warren Buffett Rescue AIG?

According to reports from Insurance Insider, with shares of American International Group, Inc. (NYSE: AIG) in free fall Warren Buffett "is thought to be in talks" with the company about a possible investment.

Shares of AIG are down 37% in pre-open trading on reports the company is scrambling to raise cash and sell assets after Standard & Poor's Ratings Services placed its ratings on AIG and subsidiaries on CreditWatch with negative implications on Friday.

AIG is looking to sell its domestic automotive business, its annuities unit, and has also looked into selling its aircraft-leasing arm, International Lease Finance Corp. AIG is also looking to raise another $10 billion in fresh capital, although it isn't clear how it would be structured. All the initiatives could bring $40-$50 billion to plug holes in AIG'S balance sheet. AIG has also reached out to the Federal Reserve for help.