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Everyone will tell you Adobe (Photoshop, Illustrator and InDesign), but you can do just as well for much less. I absolutely love Serif's products:
http://www.serif.com/store/index.asp
They are inexpensive, functional very easy to use. I've worked in desktop publishing programs for more years than I care to admit and I've found these products to be fantastic. They are also compatable with all the Adobe formats.
If you like to draw or design logos, start with DrawPlus (can use EPS files). As a side note DrawPlus can handle Flash animations. Which frigging rocks - that right there will save you hundreds. If you like to make art of photos/scans go with PhotoPlus (perfectly compatable with Photoshop Plugins and Photoshop). If you want to desktop publish and create zines/documents then PagePlus (I use it for my ezine).
Web Design is a whole different animal. There are enough freebie WYSIWYG editors out there you really don't need to fork over cash on a premium webpage designer and I've found that they muck up with the code so much it's better not to use it. Web Design is best if you can just code it by hand.
If you are using a Mac, you are stuck with Adobe I'm afraid. But the good news is Adobe and Mac get along like peas and carrots. To.. eh, borrow an expression.
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