Hedge fund manager Kyle Bass told CNBC on Tuesday that he didn't anticipate the stock market to recover as significantly as it has from its coronavirus-driven lows in March.
"I'm surprised at the size of the bounce when you look at our economy and the fact that we [may] have ... 20% unemployment, and in the center of the fairway of where we think it will be by the end of the year, in a perfect world, maybe we'll be back to 7% to 10% unemployment," Bass said on "Squawk Box."
As of Monday's close, the S&P 500 has gained more than 30% since its March 23 low of 2,191. The index sits about 15% off its all-time high of 3,393 on Feb. 19, which was reached before the economic shock from the Covid-19 outbreak unsettled financial markets across the globe.
The U.S. economy, in just five weeks, gave back all of the 24.4 million job gains and then some since the Great Recession as state stay-at-home orders and nonessential business closures were implemented to help slow the spread of the virus.
Bass said he believes the "economic and financial realities" brought about by the coronavirus are larger than what is reflected in the stock market. "We're going to have a very long grind here, trying to get these people back to work."
The founder and CIO of Hayman Capital Management also pointed to aggressive action from the Federal Reserve in response to the crisis as likely playing a role in the market's recovery. "The Fed has come in and done everything that it possibly could and then some," he added. "The Fed's buying everything but equities."