Thoughts on posting your fiction on your own blog?

I've been told two completely different things about publishing fiction on your own blog:

• Don't do it. If you publish your fiction on your blog you're giving up your chances to get it published elsewhere, be it traditionally or digitally. Also, agents/publishers are less likely to take you seriously.

• Do it. This can help you establish a readership, and there's a chance (however unlikely) that an agent or a publisher could come across your work and want to publish it.

With the way the publishing industry seem to be changing, what are your thoughts on posting fiction (short stories or entire chapters) to your own blog? Is it less of a risk now that self-publishing is gaining popularity, or should writers stick to submitting to established magazines and searching for traditional publishers?