Your source audio is mono--look up in the info area of the Project Panel with your clip selected. Your sequence does not contain any mono tracks to edit the audio into--the little speaker icons at the left end of the timeline in header area will indicate whether a track is mono (one speaker) or stereo (two speakers).
If you drag a clip to the sequence an appropriate track will be created. Alternatively, right-click (or Cmd-click, I guess) in the timeline headers and select Add Tracks; use the dialog to add one or more mono tracks. A third option is just to drag your clip to the New Item button at the bottom of the Project Panel--a sequence will be created with parameters matching your source clip, and the clip will be added to the sequence.
Okay thank you!! However is there any way to make the audio stereo. What is wrong with the audio making it be mono? Also I would like to be able to edit the video in the source viewer because it is easier to make cuts and have the audio be linked to the video.
... edit the video in the source viewer ...
This is normally done setting in and out points for quick overlay/insert edit to the timeline.
However is there any way to make the audio stereo. What is wrong with the audio making it be mono?
I don't think there is anything "wrong" with the audio, necessarily, that is making it mono. I suspect it is recorded this way; judging by the reported "mononess" and the sampling rate (16kHz), I'm guessing that this footage was recorded with either a point-and-shoot camera or some sort of handheld camcorder. That's just the way these devices work.
That said, you can "fake" stereo by selecting the clip(s) in your Project Panel (make sure that they aren't in use in a sequence yet, otherwise this won't work), and go to Clip > Modify > Audio Channels. Click the option for "Mono as Stereo" and hit OK. This will effectively duplicate your mono source channel into the left and right channels of a stereo source. This doesn't actually make the clip stereo, of course, since the audio is still recorded from a single point, so all you're really doing is making it possible to edit the source clip into a stereo sequence track. Practically speaking, there is no benefit to this; so long as your sequence's master audio track is stereo, even a mono clip will be mapped out to both channels on output. Personally, I'd just leave it as is, and add a mono track or two to your sequence to accommodate these clips.
Once you have a mono track in your sequence, you will be able to insert and overlay edit from the Source Monitor into the sequence; it's simply a matter of track targeting (read Targeting tracks for more information on this) at that point.
okay. What type of camera will record with stereo audio? If i used a shotgun mic would i then be able to get stereo audio?
It depends on the camera. Many do stereo via 2 mics. Some do 5.1, with either six (or in most cases only 5, as the LFE channel is usually not used) mics, or by signal processing. I would avoid recording more than 2-channel (either full, true stereo, or 2-channel mono).
For a shotgun, the answer is - it depends. Some are mono-only devices, while some are 2-channel.
Personally, I like shooting in stereo, but like working with mono for SFX, etc. I also like ambient audio in stereo.
For dialog, I like a mono mic, and if shooting multiple actors delivering dialog, using a mono mic on each, and separately recording the individual streams, so that I can "locate" the streams later, per my desire. Locating stereo streams can be a tad limiting, but that is my opinion. Depends on the scene that one is shooting.
Nearly all consumer cameras record stereo sound and an external mic, shotgun or other will record mono if it is a mono mic and stereo if it is a stereo mic. Just like a radio, set to AM, will recieve AM signals and when set to FM, will recieve FM signals.