Yes. Or in the (unlikely) case you have a sound card of the brand ESI, you can use the DirectWire technology in its driver - but for any other card you'll need Virtual Audio Cable.
Why: The stand alone version processes sound card input and sends the result to the output. So, if you're playing music in a CD player, through a mixer, using a microphone etc, that will all be processed.
In case of the sound card, if you use the output as input it will process that - but the result will be sent to the same output and that's why it starts to echo.
O btw - in case your sound card has multiple outputs, using another output for Stereo Tool would also be an option.
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