Who are you linking to?

I think linking to bad, crappy sites that have low SERPs can be ultimately bad for your site.

In contrast placing links on your site to reputable, well established resources can help to increase your SE position.

What are you thoughts?

I agree. One of my unwritten rules is that I won't link out to a site until I have an Alexa ranking of less than 1000000. Then I will only link out to a comparable site within the same niche.

It is important to whom you link as much as, it is important where the inbound links to your site come from.

I am pretty sure that Search Engine algorithms use this as a factor to position your site in SERP's.

Do not link to too many sites which are not relevant to yours! You should concentrate on quality relevant sites!

You should like to related theme sites that do have at least PR 1 above link pages.
This will help a lot already.

Hi, I am new to all this stuff and am either dumb or stupid. I have recently started a vBulletin forum, and I am totally confused about the basics of links. If another site wanted a link on my site where is it put, in threads/posts buried somewhere in my control panel, where what and how, I have read for hours and have not got a clue?

Just link to relevant sites, you will gain more benefit from them.

you are right.This happens mostly when we go for reciprocal link exchange.Linking with a bad partner will diminish your ranking within a short time yo can never imagine.Google just hate those things.

It's important to be responsible to whom you link your website. Linking to bad neighborhood sites or link farms can give negative impact to your sites.

Links from authoritative sites are best to boost your SERP.