I am using Windows XP and cannot record system audio
Recording system audio in Windows XP is a bit different from recording audio in Windows Vista / 7 / 8 / 8.1 / 10.
To record audio please launch Screen Capture and toggle on Microphone recording. After that select Stereo Mix / Speakers / Mix out / Wave out from the dropdown list (actual option depends on your sound card model and configuration).
In Windows XP it is not possible to record both system audio and microphone at the same time.