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Would that be ok do ya think? I'm getting together my challenge guitar and trying to be as super cheap as possible and was wondering what y'all think.

I have heard of a few people try this with absolutely no success. Steel strings just have too much tension.

If you're using extra light gauge strings it would probably work. I've seen some late 1800's martin's with extra light steel strings and ebony and ivory friction pegs.

Sounds like a pain in the butt, to save 20$....

No.

I used wood pegs on my steel string harp uke last time, which is only about 14lbs of tension per string, and they were already barely usable. So very touchy. Steel strings are much less elastic than nylon, so the amount of movement it takes to increase the pitch by a semitone is almost imperceptible. Even the 4:1 geared pegs I have on it now are more touchy than wood pegs on a classical guitar.

Flamenco gtr maybe ,SS no way.

If you want friction pegs to work succesfully you need the right reamers and buy or make a peg shaper. You would spend a lot of money on something that is unlikely to work.

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We are all in the gutter but some of us are looking at guitars.

Okay looks like a resounding NO run away now and don't look back

If you want to be cheap with the tuners buy the $6 (shipping included) Chinese tuners on eBay. I'm using those on the 40 stick dulcimers I'm building. They are nothing to write home about but seem to work O.K., and can be replaced when appropriate. When the strings cost more than the tuners that's cheap!

definitely not a cheap option, but ...on-topic, I think ...

http://www.pegheds.com/

The fiddler I used to play with in Florida used them and swore by them, and they are available for flamenco guitar.

Whether they could be adapted for steel strung guitars, I have no idea...but they would certainly look cool...