It's hard to make this one flow well, but the whole point is "yabai" can mean both "dangerous/bad" or "cool/awesome". I guess "bad" is kind of close in English, although used that way it's a bit old-fashioned by now, I think... but I can't think of a better pun right now.
Wait. Kasen lost her arm. So Watanabe is the one who cut her arm?
Watanabe's bad news...Seems a long time ago, Watanabe no Tsuna cut off the arm of an oni and ever since they've been afraid to go near the Watanabe clan!Watanabe is bad.ヤバイ (yabai) literally means "dangerous", "risky" or "bad", but also as a slang word means "cool", "awesome".Watanabe's a badass, right!?... Watanabe's so bad!Watanabe's real strong, right!?What's going on?Watanabe's real bad...Watanabe's bad, all right...Watanabe's bad...Wow, really!? Watanabe's the strongest, ain't he!People named "Watanabe" don't need to throw beans around on Setsubun!