In his 2007 book The Black Swan, Nassim Nicholas Taleb warned of the dangers of a U.S. bank imiplosion. Now, with some of his fears having been realized as the country’s financial system steers though a crisis, Taleb tells Forbes that he doesn’t think the pain is over — and that “the situation is vastly more dangerous than the Great Depression.”

“Everyone is in denial,” Taleb told Forbes’ Robert Langreth. “The car is in the middle of a crash and the parts are still flying, and we don’t know how far they are going to fly.” Taleb thinks the situation is more dangerous than the Depression because so many people now own stock through 401(k)s.

According to Taleb, whose book focused on how history is littered with unpredictable events — both good and bad — there are two big problems with Wall Street: first, it is in the business of hiding risk, and, second, it greatly underestimates the probability of outsize moves. “Faulty risk-control models from overconfident economists offered the illusion that we had everything under control and that banks were profitable when they really weren’t,” Langreth writes in explaining Taleb’s beliefs, “at least not over the course of a full boom-and-bust cycle. The entire financial system is crash-prone and must be rebuilt to make it safer and more stable.”

According to Langreth, Taleb bets on the market’s “fat tails” — the extreme ends of potential gains or losses. “He puts most of the money in Treasurys, then takes side bets on volatility,” Langreth writes. “He sells options that pay off with moderate volatility and buys options that pay off big with big volatility. The strategy has him and long-time investing partner Mark Spitznagel delivering a string of mediocre results interrupted occasionally by spectacular years.” One of those spectacular years, Langreth says, was last year, when Taleb’s take was “in the low eight figures”.