Please note that I am NOT trying to record sound with a microphone. Please do not link to the skype video.

I am trying to get sound recorded from the window application I am running. I have tried changing from Alsa to Pulse Audio and all that does is cause recordmydesktop to hang when encoding. I let it sit for 30 minutes on a 15 second video and it never moved from 0%

I have checked alsamixer and nothing is muted. I ran gtkrecordmydesktop and set sound to the Default device and it did not work at all.

What am I doing wrong?