Changing the Default behavior of pictures inserted into word 2007

Heres what Microsoft's online help says:

...You've got a great picture to illustrate your text, and you know exactly where you want it to be positioned. When you insert the picture, however, it floats off the page or seems to be cut off, which is not what you had in mind.
When a picture is inserted into your Word document, its default placement is in line with your text. That is, Word inserts the picture where your cursor is, even though it may not be aligned properly with the text around it...

The bold part is what I want to change... is this even possible?

 

I'm not at my work computer to check but am almost certain you can change the default picture layout (I've done it 2003). The trick in 2007 is figuring out where they've put the option! Because of the type of documents I create and edit, "In front of text" works better for me.