The Securities and Exchange Commissionâs division of trading and markets said that the decision to supply temporary funding to Bear Stearns Cos. (BSC) followed a âsignificant deteriorationâ in the bankâs liquidity on Thursday. SEC officials said in a statement that they had been monitoring Bear Stearnsâs financial situation on a daily basis in recent weeks, and had no cause for alarm earlier in the week. Bearâs holding company capital exceeded regulatory standards at the end of February, and information supplied by Bear Stearns to the SEC on Tuesday showed the holding company had a âsubstantial capital cushion,â according to the SEC. As of that date, the firm had more than $17 billion in cash and unencumbered liquid assets, the SEC said. âBeginning on that day, however, and increasingly throughout the week, lenders and customers of Bear Stearns began to remove funds from the firm, despite its stable capital position. As a result, Bear Stearnsâs excess liquidity rapidly eroded,â the statement says. On Friday, federal officials announced a deal to provide a 28-day loan to Bear Stearns through Federal Reserve borrowing by JPMorgan Chase & Co. (JPM). The SEC division that oversees U.S. markets said it is continuing to monitor Bear Stearnsâs condition and believes its registered broker-dealers âremain in compliance with commission capital rules.â The SEC reiterated that it is working closely with the Treasury Department, the Federal Reserve and the Federal Reserve Bank of New York to ensure that its regulation contributes to âorderly and liquid markets. So, there was no liquidity problem with BSC, the rumors destroyed the company ? If so, we have no "liquidity crisis" instead a confidence crisis, or ?