Maybe cash isn't king after all at Bear Stearns ( BSC). For months now, Wall Street has been abuzz with rumors that the big investment bank was in dire need of a capital infusion. The chatter started this past summer, when Bear became the most prominent casualty of the subprime mess, after two of its in-house hedge funds collapsed under the weight of bad bets on mortgage-backed seucrities. Fears of a liquidity crunch sent shares down 40% from their highs back in early August. But Monday's cross-shareholding deal with Citic Securities of China signals that for all the worries, Bear continues to look to the future. The New York-based brokerage firm is concerned less about its cash position than about competing with global rivals such as Goldman Sachs ( GS), Morgan Stanley ( MS) and Merrill Lynch ( MER). "We thought we'd see someone hand Bear a bunch of cash and call it day," says Peter Goldman, managing director at Chicago Asset Management, which owns Bear shares via its large-cap value investment fund. But "in my mind this is a positive. It expedites their push in to Asia." The two firms agreed to invest $1 billion in each other via convertible securities that don't include voting shares. Citic will take an interest of about 6% in Bear Stearns, with the option to buy another 3.9% in the public market. Bear's investment adds up to about 2% of Citic. The firms will do business together in Asia, creating a new venture in a home base of Hong Kong.