He first told us on Wednesday that financials could climb 10-15% in two months or so, but now Doug Kass tells us banks look like they have even more upside - a lot more upside.

And Kass is putting his money where his mouth is.

Kass, who is the president of Seabreeze partners and CNBC contributor tells us he bought the XLF at $13.

And after examining a slew of factors, he now he tells us "I'm also making a medium term call. I think banks stocks can almost doublewithin the next 12 months."

Largely, Kass thinks most investors don’t understand what’s the current weakness has a whole lot to do with forced liquidations from big money hedge funds and exaggerated moves due to high frequency trading. In other words, banks were oversold.

Also, he sees some tailwinds in the way of low interest rates which Kass calls, “a silver lining for the banking industry.” And he says franchise values are enormous relative to the current stock prices.

And despite all the headwinds such as the flat yield curve and weakness in real estate, he thinks there’s still plenty of money to be made in lending, plain and simple.

”If investors begin to focus on pre-tax income and recognize how strong and sustainable the numbers are they’re soon realize bank stocks are at absurd levels relative to their earnings power one to 3 years out.”

And Kass’s enthusiasm for stocks isn’t limited to the banking sector. He says it extends to the entire stock market.

”I said on Fast Money that the August lows will hold and I still believe they will,” he says. “I see no evidence of a double dip.”

Kass explains that a lot his ‘tells’ or gauges of real time activity are holding up just fine.

The Conference Board’s Leading Economic Indicator is up 6.2% year over year, and “usually we don’t have a recession until it’s negative.” Kass says the same holds true for retail sales. “The Johnson Redbook Index was up 4.7% - and that’s through last Friday. And the 4-week moving average on initial jobless claims is now at its lowest levels since April.”

All told, “things just aren’t as bad as the market suggests. I just don’t think we’re falling off a cliff.”

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Trader disclosure: On Aug 18, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Adami Owns (AGU); Adami Owns (C); Adami Owns (GS); Adami Owns (INTC); Adami Owns (MSFT); Adami Owns (NUE); Adami Owns (BTU); Finerman owns (AAPL); Finerman owns (BAC); Finerman owns (JPM); Terranova owns (XOM); Terranova owns (CVI); Terranova owns (CAT); Terranova owns (OXY); Terranova owns (AAPL); Terranova owns (DAR); Terranova owns (FCX); Terranova owns (CACI); Terranova owns (ARUN); Terranova owns  (ORCL)’ Terranova owns (EMC); Terranova owns (NCR); Terranova owns (VMW); Terranova owns (IBM); Terranova owns (AMZN); Terranova owns (LULU); Terranova owns (LTD); Terranova owns (WFM); Terranova owns (JPM); Terranova owns (AXP); Terranova owns  (FXA); Terranova owns (VRTS); Terranova owns (LQD); Najarian owns (GLD) covered calls; Najarian owns (VIX) call spreads; Stutland Owns (DBA) and short (DBA) calls; Stutland Owns (GLD) calls

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CNBC.com with wires.