Algorithmic trading is indeed an example for the kind of risks posed by complication (unmanageable) systems but also shows that we evolve our security measures with each small-scale catastrophe. There is no example of some existential risk from true runaway technological development yet although many people believe there are such risks, e.g. nuclear weapons. Unstoppable recursive self-improvement is just a hypothesis that you shouldn't take as a foundation for a whole lot of further inductions.
Dispelling Stupid Myths About Nuclear War
An all-out nuclear war between Russia and the United States would be the worst catastrophe in history, a tragedy so huge it is difficult to comprehend. Even so, it would be far from the end of human life on earth. The dangers from nuclear weapons have been distorted and exaggerated, for varied reasons. These exaggerations have become demoralizing myths, believed by millions of Americans.
[...] SIAI's Scary Idea goes way beyond the mere statement that there are risks as well as benefits associated with advanced AGI, and that AGI is a potential existential risk.
[...] Although an intense interest in rationalism is one of the hallmarks of the SIAI community, still I have not yet seen a clear logical argument for the Scary Idea laid out anywhere. (If I'm wrong, please send me the link, and I'll revise this post accordingly. Be aware that I've already at least skimmed everything Eliezer Yudkowsky has written on related topics.)
So if one wants a clear argument for the Scary Idea, one basically has to construct it oneself.
[...] If you put the above points all together, you come up with a heuristic argument for the Scary Idea. Roughly, the argument goes something like: If someone builds an advanced AGI without a provably Friendly architecture, probably it will have a hard takeoff, and then probably this will lead to a superhuman AGI system with an architecture drawn from the vast majority of mind-architectures that are not sufficiently harmonious with the complex, fragile human value system to make humans happy and keep humans around.
The line of argument makes sense, if you accept the premises.
But, I don't.
Ben Goertzel: The Singularity Institute's Scary Idea (and Why I Don't Buy It), October 29 2010. Thanks to XiXiDu for the pointer.