why "localhost" does not resolve

There is a problem accessing localhost on Vista. This post shows the solution to this problem:
http://www.moorlandit.net/index.php/2009/05/accessing-localhost-on-vistawindows-7-96

I am copy-pasting it here:

For some reason in Vista and Windows 7 localhost doesn’t work out of the box. To get it working you have to add this line to the c:\windows\system32\drivers\etc\hosts file:

127.0.0.1 locahost

Now the hosts file is a Windows system file so the only way Windows will allow you to edit the file is if you do it as Administrator. To do this click Start and type CMD in the search box, when Windows shows cmd.exe right-click it and click run as administrator then when the DOS box opens type:

edit c:\windows\system32\drivers\etc\hosts

Then add the 127.0.0.1 localhost line and save and close the file. Then localhost should work as it did in XP.