Input meters don't seem to work properly

I’m using version 1.3.6. The meters for the input levels are pegged to the right when I’m recording or monitoring the input. The level adjustment slider seems to affect the wave form, but does not change the meters. Is this a problem/limitation of the program? How can I optimize the input level without meters that accurately show the signal strength?

Pretend I’m going shopping and I need to buy exactly what you have and connect it up the same way. What do I buy and connect?