Just exactly what the facts is
Run Windows Update. Run it now now now.
Just trust me and come back and I'll explain why.
Back already? See, that wasn't so bad.
OK, here's the deal. As you might already know if you're reading Chesterley, there's a new significant security hole in Windows. To give you an idea of how bad this is, Microsoft announced that they would issue a patch on their regular schedule, next Tuesday. But the hole has been so widely exploited (and so widely reported on) that they released the patch 5 days early, around 5 PM EST today.
(I do this for a living. If you can pressure Microsoft into releasing something early, it's major.)
Willya open up Internet Explorer and run Windows Update already? If your computer is set up right, you may even have a little Windows icon down by the clock on your menu bar telling you to install this update. Do it, reboot, come back.
Sticking around for more info? My, you are stubborn. ComputerWorld has a particularly good discussion of the WMF vulnerability if you'd like, but here's the end user translation.
Windows Metafile (WMF) is a graphics format which can execute code. At the time, this seemed like a really good idea, because it improved things like print queue management. WMF files are now used for anything, from Office clip art to Web design to creating the previews of documents you might see in Windows Explorer.
Since this was announced on December 27th, somewhere over 100 "exploits" of this hole have been written. The lucky people are just getting a whole ton more popup ads than they used to. The unlucky ones don't even know their computers have been stolen; the box is still present, but the guts belong to someone else now.
And since this is a virus that travels in a graphics format, you can get it through pretty much everything that doesn't run in a command shell. Email exploits were the first, followed quickly by instant messenger attacks. Scuzzy website operators put them on their websites to spread spyware. What really scares me is that legitimate web sites were hacked to include WMF graphics, which means you could've done everything right and still gotten hit.
So to sum up: patch your operating system. Keep hitting "continue" or whatever else the affirmative option is until Microsoft tells you there's nothing left to install. Then, make sure your antivirus software is getting current updates.
If you're one of the 4 users of Windows 98 or ME, Microsoft has decided not to patch your system because it's too old. If you want a secure computer, you have to upgrade the OS. Sorry.
And if you're a Mac or Linux user? Don't look so smug until you've updated your patches and your antivirus definitions. We only get to be smug as long as it doesn't happen to us.
Once your system is properly secured, permission to Yippee Dance is granted.