Inserting image into IPython notebook markdown

Question

I am starting to depend heavily on the IPython notebook app to develop and document algorithms. It is awesome; but there is something that seems like it should be possible,

Answer 1

[Obsolete]

IPython/Jupyter now has support for an extension modules that can insert images via copy and paste or drag & drop.

https://github.com/ipython-contrib/IPython-notebook-extensions

The drag & drop extension seems to work in most browsers

https://github.com/ipython-contrib/IPython-notebook-extensions/tree/master/nbextensions/usability/dragdrop

But copy and paste only works in Chrome.