This is a relatively new problem because System.NET used to ignore proxy settings for localhost, and therefore Fiddler wouldn't see the traffic by default (http://docs.telerik.com/fiddler/Configure-Fiddler/Tasks/ConfigureDotNETApp) - see bottom section.
Now this no longer appears to be the case, so I expect more people will have the same question. Fiddler supports several ways to filter requests, though nothing that the client can control (which is probably good, since you wouldn't want malware from excluding its traffic). The most appropriate and simplest mechanism in this case is probably to set a filter for any url that contains localhost or vshub. You can do that by:
- Click the filters tab (it's a top-level tab, at the same level as inspectors, statistics, etc.),
- Check the checkbox labeled 'Use Filters'
- Scroll down and find the checkbox labeled 'Hide if URL contains'.
- Check that box, and enter either localhost or vshub into the accompanying textbox.
- You should see the vshub traffic stop immediately.
This filter will persist, so if you shutdown Fiddler and start it up again later, it will still be set.
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