The best resource for you would be Wayne Goddards "The $50 Knife Shop". (make sure you get the revised edition) It will give you loads of info about getting started making knives without spending a bunch of money.
For the sake of argument, all you really need is a hacksaw, some sandpaper in different grits - say 80, 120, 220 and 400, a flat file - I'd go with a Nicholson 12" single cut file, but a 10 or 14 will work as well, you'll also need some steel. I'd suggest breaking down and buying some 1084 from http://www.njsteelbaron.com. But you could use an old file or lawnmower blade. The only problem is that you don't know what type of steel was used to make it. For handle material, if you really wanted cheap just find an old dead limb and cut it up. I'd recommend going to Lowes or Home Depot and getting some premium wood and make your scales out of that. You can get it for a few dollars for a foot or 2 foot section.
And that's about the basics. Power tools make the job easier. But not necessary.
If you have a local flooring company or cabinet shop, they may have some hard wood scrap flooring that you could use for handles. I found some hardwood scrap at a building materials recycling center.
As DonL mentioned, spend a little extra and get some known steel. My first knife was 01 tool steel, quenched in used motor oil. I made a 1 brick forge mentioned in the $50 dollar knife shop book. Check a local ceramics/pottery supply store that sells kilns. They usually have the soft fire bricks.
Check out Tim Lively's website http:www.timlivelyknives.com/ He has a DVD which shows you how to set up a charcoal forge and how to forge a knife with minimal tools. The guys here are also a fountain of knowledge and are willing to help.
Take a look at the following url - http://www.knife-making-supplies.net/cheap-knife-tutorial.html. The "Absolute Cheapskate Way to make a Knife by Scott Jones" it is a neat tutorial which is the one I used when making my first knife in terms of method, procedures etc. I changed the material slightly to suit what I could find. There are at least three or four other people I know of who have done exactly the same when making their first knives.