Drawing diagrams in Pages don't stay in place with text I feel like I'm missing something, but maybe this is just a flaw in the software. 

Whenever I draw diagrams in Pages, or insert images, they seem to just float there, and if I change text above, it causes the text to go past the image I inserted. For example, if I have a paragraph of text that references "the diagram below", and I add another paragraph above it, the diagram would now be above the paragraph of text because it doesn't move with the text as its editing.
Pages allows for several ways to insert graphics and either float them or anchor with the text.

Dragging in a image or object

Press Command ⌘ as you drag and the blinking cursor will indicate the insertion point

This will keep the picture relative to the text where it was inserted.

Working with the Inspector

The settings for objects are found in the Inspector.

Stay on Page

This will anchor the image or object relative to the page regardless of the text added.

Move with Text

This will allow the image to move with the text as more is added.  Essentially anchoring the image to a place in the text so that when text is added above the insertion point, the image will move down the page along with the text.