Most cloth-covered wire is very hazardous, especially if it has been baking in undersized junction boxes or crammed into an extra tight fixture with high wattage bulbs. When you try to install a new ceiling fan, or hang a new light fixture, it crumbles in your hands. Many times, a 20-Amp circuit breaker will be protecting it, contributing to a potential fire hazard. You will find #12 THHN wire in the panel that matches up with the 20 Amp circuit breaker, but that wire will then extend out into the walls and ceilings and will be spliced to your old cloth-covered wire. Usually it will be #14. Not a good idea. Remember, Think Electrical safety first!