Kass: Preserve Precious Cash

Stated simply, in the current period and anticipated reset period, the range of economic outcomes remains broader than usual.

It is for these reasons (and others) that most investors should take a permanently more defensive position than in the past: Under these circumstances investors should be more concerned with the loss of capital than the loss of investment opportunity.

In a period during which it is different this time, common sense and logic dictate that most investors should err on the side of conservatism in the stewardship of their assets.

There is simply too much guesswork and too many moving parts for most investors to have a strong conviction. Exposure to equities should be below average for some time to come as money is too valuable and its preservation in this tumultuous environment of untested conditions and nontradtional headwinds should remain investors' first priority.

Cash will be king for some time to come. Preserve it!

Doug Kass writes daily for RealMoney Silver, a premium bundle service from TheStreet.com. For a free trial to RealMoney Silver and exclusive access to Mr. Kass's daily trading diary, please click here.

At the time of publication, Kass and/or his funds had no positions in the stocks mentioned, although holdings can change at any time.

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Know what you own: Some of the most active stocks during Tuesday's midday trading include Bank of America (BAC Quote), Citigroup (C Quote), CIT Group (CIT Quote), Financial Select Sector SPDR (XLF Quote), SPDRs (SPY Quote), Dell (DELL Quote) and PowerShares QQQ (QQQQ Quote).