Congress and federal regulators should consider new legislation or rules, including those that would extend capital adequacy standards to cover liquidity risk, to prevent other large banks from suffering the fate of Bear, Stearns & Co., Securities and Exchange Commission chairman Christopher Cox and a top Federal Reserve official told Senate Banking Committee members yesterday.

Cox, speaking at a hearing on the Fed-facilitated acquisition of Bear Stearns by JPMorgan Chase & Co., said that up until the run on Bear Stearns during the second week of March, the bank was "well capitalized and apparently fully liquid."

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