Echo or Reverb Occurs when recording streaming audio

I am using the latest Audacity download on Windows 8.0 and I get a reverb or echo that increases exponentially (when recording streaming audio from any source)as I increase the record level above the lowest setting (.29 or so). When the record level is increased to normal levels, the echo obliterated the sound.
I have a Conexant SmartAudio HD sound card, and have the stereo mix level set to zero (otherwise this reverb occurs even when not recording), with the recording echo occurring regardless of the speaker volume, internet explorer, or audacity volume. This echo does not occur with other recorders, but I otherwise like audacity the best.
Anything I may be missing, I searched the manual and posting boards?


In other words, turn off Transport > Software Playthrough.