Use yarndex and check yarn.com and elann.com for super inexpensive & quality yarns. I particualrly love yarn.com's cones for sweaters and stuff. I got 3 cones of silk tweed for $22 each, and it's enough to make a skirt & jacket.
I'd think any of the brushed mohair yarns would be a reasonable substitute. Classic Elite's LaGran is pretty thrifty as is Plymouth's Outback brushed mohair.
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