So one day, dunno how, you found yourself talking on Skype with Ellen Page (or Kirsten Durst, or Jessica Alba, or whoever you find attractive). Being a total geek, you feel that you have to record this once-in-a-lifetime moment to make your grandkid proud. But how can you do it? There is no record button on skype! Should you record it using your walkman? Meh, that's so old school.. So here's a tutorial on how you can record conversation, song or basically any kind of sound coming out from your computer, and save it as MP3 (or WMA, or whatever format your computer can handle). Yes, that's include sound from youtube dvd dailymotion googlevideo and so on and so forth.. What you need to have:

1. Audio editor software
2. A little time

For audio editor software, I'm using Audacity. I have nothing against other software like Sony SoundForge, WaveLab, etc. I heard that they are way better than Audacity, but, alas, for this purpose this free-opensource software is more than enough. Step 1:Install Audacity

• Download Audacity
• Usually there are 2 versions, one is STABLE and one is BETA. I would recommend you to download the STABLE version, because they are ... well.. more stable. The installation should be straight forward,
• Download LAME MP3 Encoder
• We need this to save the digital audio as MP3. You have to download this separately due to some legal issues.
• Download the windows version. You only need  lame_enc.dll from that zip file. Extract it anywhere you want. It's just a personal preference, really.. but I put it on C:\Program Files\LAME\ so I can easily find it later..

Step 2:Getting Ready Now here's the tricky part, you need to change the active recording device on Audacity to "Stereo Mix" / "Wave Mix" / "Mono Mix" / something along those line (depends on soundcard). Extra Step only for Windows Vista

• Control Panel >  HardWare and Sound > Manage Audio Devices
• By default, Stereo Mix is disabled on Windows Vista, so you need to enable it. First, right click on the empty area and check Show Disabled Device
• Now since you can see it, right click on Stereo Mix and choose Enable.

Windows XP and Vista

• Edit > Preferences
• Choose  Stereo Mix (if you choose Microphone, you will record sound from your Microphone line. Same goes to line in, digital in, or whatever input line you have on your system.)
• On the same tab, choose 2 (Stereo) on Channels.
• On File Format tab, click Find Library and locate your lame_enc.dll file that you get on the 1st step.
• For BitRate, I personally don't want to go any lower than 128. To make sure that I'm not loosing any quality, I choose 192.

STEP 3:The actual recording

• Click the big fat red button universally known as RECORD when you think you're ready to start.
• If you get the 2nd step correctly, you should see some movement on the spectrogram.
• And when you're done,click STOP (the boring yellow square button)
• Do editing as you like, cut delete trim the song..  I won't go into details here. It's not rocket science, you should be able to figure it out yourself. Click the green play button to preview your change.
• Last step, export as MP3.

That's all folks. Money in the bank :)