The author of "Black Swan" believes Monday's crash is just the beginning. Nvidia (NVDA.US) opened high but then plunged.

On Tuesday, Nvidia (NVDA.US) opened with a volatile trade, jumping high and then plunging as much as 1.6%, now recovering to over 1% to $120.20. Nassim Taleb, the author of "Black Swan", warned that Nvidia's Monday's plunge was just the beginning for investors who blindly rushed into AI-driven stocks. Taleb said during the Miami hedge fund week that the future pullback could be twice or even three times the 17% drop the company saw earlier in the week. The Monday's drop wiped out $589 billion of Nvidia's market value, the largest ever. "This is just the beginning," Taleb said in an interview after Monday's close.

"This is the beginning of people adapting to reality. Because now they realize that it's not perfect anymore. There's a little crack in the glass." Taleb said so far investors have been too focused on one narrative: that Nvidia's stock will continue to rise as the company maintains its dominance in AI. He said the Monday's drop was actually "very small" considering the industry risk.