I am mostly OK with cloud-based services that keep a master set of my files so long as I have a complete set on my hard drive too. That’s how Dropbox works. I give up some privacy — if Dropbox gets a subpoena or a National Security Letter they’ll give up my data and I’ll never know, plus the stuff is no doubt scanned in transit by You Know Who. But I get a lot of convenience, plus the security of being able to recover accidentally deleted files. And if something is really private, I could just keep it off the Dropbox.
Where I draw the line is cloud-only services like Google Drive or Box.com. This ITworld article, How Box.com allowed a complete stranger to delete all my files illustrates why.