2 years, never had this happen before

Hello all,
I've had my MacBook for over 2 years, and I have been using JBL speakers off and on for these 2 years; now all of a sudden, today, I cannot use the internal speakers! When I hit the increase/decrease volume button or the mute button, I get the "universal NO sign." (circle-slash over the speaker icon)
And there is a red light in the port where you connect the speaker wire which was never there before!
I have tried iTunes, and internet movies, no sound on anything... I don't want to have to lug my speakers around everywhere! Help!
Anybody know what the "bleep" is going on??
Thanks
- and for the record I tried a shut down and a repair permissions, my usual "something's wrong actions." And I checked in system prefs>sound to make sure mute wasn't checked.

The headphone jack doubles as digital audio out and has a small switch inside that gets flipped if headphones/speakers are attached. The red light is an indication that the switch is stuck in the "on" position.
You can try inserting and removing your headphone/speaker cable a few times and see if that sorts it or you can take a toothpick and poke around inside the jack and try to flip the switch to the "off" position.
~Lyssa

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