Thread by @DougKass

@realmoney

Mar 18, 2021 | 05:00 PM EDT DOUG KASS
Assessing the Damage
My Takeaways
* The damage today was broad-based
* I ended the day with a medium-sized net short exposure (down from very large at the beginning of the day)
* Banks may have had a buying climax today
* Tech

(especially of a speculative-kind) remains overvalued

I recently wrote that my (negative) market view has rarely been at such odds with the generally bullish consensus.

This remains the case.

Based on my view of "fair market value" the S&P is still about 20% overvalued.

That does not mean, however, that an overvalued market needs to return to its value -- as markets tend to spend long periods as overvalued (but only short periods of undervaluation, like in December, 2018 and in March, 2020).

It does mean the there is very little "margin of

of safety" at the (long) margin and that the upside reward is dwarfed by the downside risk.

As noted, I was active in my Index shorts during the trading session:

* I covered the first drop - moving my overall short exposure from very large to large.

* And I reshorted the

rally - moving my overall short exposure back to very large.

After the close, reflecting the severity and swiftness of the P.M. downturn I reduced from large to medium sized my Index shorts.

This takes me back down medium-sized in net short exposure from very large (and a bit

over my skis) net short.

In a market of heightened volatility, as we see these days, trading around my core positions is a continuing effort of mine.

Overall breadth on the NYSE was foul at 4-1 negative.

In terms of individual sectors:

* Bank stocks appeared to experience

something of a high volume climax that put the sector back into an even more seriously overbought condition. As posted in my Diary, I have been reducing positions, which were very large recently to small today. I continued to sell off some of my bank stocks on today's strong

absolute and relative price action. By the close of the day, a lot of the morning spikes were given back in the space.

* Tech as dreck. Amazon ($AMZN) was a big disappointment as were other large-cap tech-stocks like Microsoft ($MSFT) , Google ($GOOGL) , Twitter ($TWTR) ,

Tesla ($TSLA) and others. ($ARKK) was leaking (down to $120 from $131, where I added yesterday to my short).

* Spec Tech was also dreck. My short gewgaws like ($PTON) , ($MARA) , ($CAN) , ($RIOT) etc. continued the weakness that was so conspicuous on Wednesday.

* Cyclicals weak

ened. Retail was weaker (including ($WMT) ). Homebuilders got schmeissed (down between 6% and 8%). Airlines fell down to earth (I added to my ($DAL) short yesterday -- now between medium- and large- sized.)

Verizon ($VZ) , a large long holding, was the only non financial equity

on my screen that was green.

The 10 year U.S. note yield closed +7 basis point to 1.71%.

I will be out tomorrow but you will be in the capable hands of Bret Jensen.

Thanks for reading my Diary and enjoy the evening and the weekend.

Be safe. @jimcramer @tomkeene @SquawkCNBC