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Put together Dave Winer's essay on The Rule Of Links

The Rule of Links is that you link when it's appropriate to do so. Linking is an art. It's a choice. You don't link from every word or even every noun, or from the subject of every sentence. But when a reader reasonably would want to know more about the subject, the Rule of Links says you should link to it.

..... and Gavin Bell's post expressing concern about wanting to refer to people on blogs but not being able to link to their own output to give context:

It feels odd to see someone's name on a site without a hyperlink around it and mentioning someone who has a weblog and not citing them feels wrong too.

... and you get a sense of where the edge of the blogosphere lies.