Scenario: You want to talk with someone over google hangouts (like for a user study), and you want to record BOTH:
- the system output audio (from them)
- the microphone audio (from you)
(screenshots below in a comment)
brew cask install soundflower
This is for Quicktime to be able to record audio from both you and the other person.
- open the OSX system app
Audio Midi Setup Create Aggregate Device- Include both inputs:
Built-in MicrophoneSoundflower (2ch)
- Name this one
Dual Input(optional)
This is so both you and quicktime (via the aggregate device^) can hear what's going on.
- open the OSX system app
Audio Midi Setup Create Multi-Output Device- Include all both outputs:
Built-in OutputSoundflower (2ch)
- Name this one
Dual Output(optional)
- alt-click on the volume icon in the taskbar
- choose your system
input=Dual InputOutput=Dual Output
- Open
Quicktime Player File->New Screen Recording- In the dropdown next to the record button
- Microphone =
Dual Input
- Microphone =

Screenshots
1
2
3
4
5