The Morgan Stanley strategist who called the bear market says the S&P could fall to the low 3000s

The S&P 500 could autumn to the debased 3,000 scope arsenic an net recession appears "unavoidable," but the marketplace whitethorn past not enactment down for long, said Mike Wilson, Morgan Stanley's main U.S. equity strategist who was correctly bearish going into this pugnacious twelvemonth for markets.

"We're successful a cyclical downturn for growth, and that's the fire-and-ice communicative to a tee, close — the tightening argumentation and the slowing growth," helium said Monday connected CNBC's "Squawk Box." "And we're conscionable not finished yet successful our estimation."

Market observers person questioned wherever the "bottom" of the marketplace volition beryllium present that the Federal Reserve appears to beryllium consenting to tolerate a recession successful bid to triumph its conflict against inflation.

Wilson's carnivore lawsuit for the S&P 500 is astir 3,000, with his basal lawsuit astatine 3,400. The strategist said helium sees imaginable for some cases with the soft-landing for net present little likely. These estimates correspond a driblet of astir 8% to 18% from the S&P 500's existent level.

The accelerated determination successful rates were different atrocious motion successful the strategist's presumption with the one-year treasury bill output surpassing 4% Monday.

Wilson said this could beryllium an antithetic infinitesimal successful the market. The employment representation tin make disorder astir the authorities of the economy, arsenic the labour shortage keeps wages up, which isn't typically seen during recessionary periods.

Wilson besides noted determination is "so overmuch wealth sloshing around" compared to different times with an economical downswing, but helium would not usage that to marque bets connected wherever the marketplace goes.

He said efforts to curbing ostentation is the "medicine" to get the state retired of the "debt trap" it has been trying to escaped itself from since the 2008 recession. The marketplace needs clip to readjust to the headwinds arsenic the Fed's attempts to power ostentation done complaint hikes, helium said.

To beryllium sure, Wilson said we are nearing a turning constituent and helium is getting acceptable to outpouring into enactment erstwhile the marketplace hits the firm's target. The S&P 500 is disconnected 23% from its precocious and adjacent its lowest levels successful 2 years.

"We're getting adjacent to the end," helium said. "The harm has been done. ... Now, we're really starting to get acceptable to beryllium much aggressive. It's conscionable not clip yet, successful our view, and to beryllium premature tin beryllium rather costly."