From the circuit's website:
In theory, this circuit will not work because it needs a pre-amplifier. Supposedly, a 741 or any othe pre-amplifier is needed. As I said before, I don't follow the theory. I already verified that the pre-amplifier is not needed, just adjust the 10k variable resistor. In fact, You may not be able to get the circuit to work properly with a pre-amplifier.
You may just be unlucky
If you are getting feedback, however, make sure the microphone and speaker are well separated. Otherwise sound from the speaker gets into the microphone, which is amplified and sent to the speaker, which gets into the microphone, and...well....that's feedback.
: MIDI drum machine / sequencer / groove-box for Arduino