Famed Bear Turning Into Bull

When you think of Doug Kass you probably think of somebody who's pretty bearish. He's certainly been negative on the market since summer.

Well that's changed.

Kass, who is President of Seabreeze Partners and famed for his market timing, told Fast Money on Friday that his outlook for stocks has changed – a lot.

He called the current decline in the market an opportunity "much like we saw in the summer of 2010," when stocks surged on talk of QE.

This time he believes the catalyst will be much more surprising – he thinks Congress will put aside partisan differences and reach a compromise on the "fiscal cliff", that is, the series of automatic tax hikes and spending cuts that will start to take effect early next year unless lawmakers agree on a less austere way in which to address the debt.

And the market may have received its first true glimpse of that very scenario on Friday after both Democratic and Republican leaders expressed confidence they could reach a deal at the conclusion of a much anticipated meeting.

Though no details were disclosed, both sides appeared willing to give ground.

"I believe we can do this and avert the fiscal cliff," Republican House Speaker John Boehner told reporters on the White House lawn after the leaders met with President Barack Obama.

Democratic Senate Majority Leader Harry Reid was equally upbeat. "We feel we understand what the problem is," he said. "And I feel very good about what we were able to talk about in there."

Kass believes lawmakers understand that they have to reach a bipartisan solution to the crisis – that they have no other option.

"Fears of the fiscal cliff are overblown," he said. "I think a frame work will be put in place in which debt will be reduced by $3 trillion over the next 10 years," he said, " and that will be very good for financial markets."

In the near term, Kass suggests positioning for a year end stock market rally. "The business sector is pent up – not spent up," he said.

Posted by CNBC's Lee Brodie

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Trader disclosure: On November 16, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC's "Fast Money" were owned by the "Fast Money" traders; Joe Terranova is long VRTS; Joe Terranova is long TJX; Joe Terranova is long AAPL; Joe Terranova is long SWN; Joe Terranova is long VZ; Joe Terranova is long XOM; Joe Terranova is long AAPL DEC 5/5 CALLS; Jon Najarian is long AAPL; Jon Najarian is long FB; Jon Najarian is long MSFT; Jon Najarian is long HRB; Jon Najarian is long INTU; Jon Najarian is long AMZN; Jon Najarian is long NKE; Jon Najarian is long GPS; Jon Najarian is long WYNN; Jon Najarian is long BYD; Jon Najarian is long VOD; Jon Najarian is long CME; Jon Najarian is long CBOE; Jon Najarian is long STSI; Jon Najarian is long GLUU; Simon Baker is funds long WFC; Simon Baker is funds long QCOM; Simon Baker is funds long HD; Simon Baker is funds long GOOG; Simon Baker is funds long GS; Simon Baker is funds long CSCO; Simon Baker is funds long AAPL; Simon Baker is funds long XLY; Steve Grasso is long ACI; Steve Grasso is long AET; Steve Grasso is long ASTM; Steve Grasso is long AUO; Steve Grasso is long BA; Steve Grasso is long BTU; Steve Grasso is long CLF; Steve Grasso is long F; Steve Grasso is long LF; Steve Grasso is long LNG; Steve Grasso is long MHY; Steve Grasso is long P; Steve Grasso is long NVIV; Steve Grasso is long PFE; Steve Grasso is long S; Steve Grasso is long WYNN

CNBC.com with wires.