Learn a language.
Enthusiastically seconded. That, and more community service/volunteer work. It’ll make you feel good and you’ll be helping others.
I just want to jump in and say that I appreciate all of the suggestions so far. As to the ones I’ve taken, I’ve looked into learning a bit more Spanish, I’ve dug out my guitar, I’ve looked up the nearest library on google maps, and I’m looking at possibly getting an internship or doing volunteer work with different social services organizations (my degree was in Sociology/Criminal Justice and I’m studying for a Criminal Justice masters degree, final goal being a probation officer or some sort of desk job within that realm).
Extra credit if you choose one for which you have the wrong number of mouths!
Go fishing.
Take up creative writing, anything from poetry to True Crime. Besides the time writing, you can burn all sorts of time researching for whatever you choose to write AND there are approx. sixty thousand books on ‘how to write’ you can borrow from a library and read.
And, good timing! Because November in NationalNovelWritingMonth, and boundless suggestions and encouragement are available to help newbies start writing. See www.nanowrimo.org
Might I suggest brushing up on basic arithmetic? 
That and model making…
MMORPGs are your friends. EVE seems to be the most promising of the severe timesinks. WoW offers hope of eventual recovery
everquest 1 can be played for free if you go looking for emulators
but I dont recommend the mmo path, its addicting as hell for most people and if you should ever get a job the damn game may cost you it.
Take up playing over at Improbable Island.
If you want to be nice and get me a small (in-game, non-monetary) bonus for referring you, click this link instead.
Build a death ray?
Oh, you said “cheap.” Well then, use household implements.
I believe WoW requires a monthly fee. Instead, you can pick up a copy of Diablo 2 and the expansion pack, probably pretty cheap since it’s about 8 years old now and D3 is about to come out, and play online for free after that. The other dopers who used to play seem to have given up on it, so I seem to have several accounts full of good stuff all to myself. (I feel like the last man on Earth. I have all kinds of toys to play with, but nobody to play with.)
Not exactly a hobby, but have you read all the threads in Threadspotting? Entertaining, free, and time-consuming!
Make art. I stumbled across this guy’s website a couple of months ago, and am right now in the final stages of building my own 3 foot long flying dragon. (I hope to build a fish like the one in the Fishwichwich video as my next project.)
Doesn’t cost much, just newspapers, hangers, flour, an old sheet, cheap-o glue, and some basic paint colors.
I’ve never done anything like this, but I’m quite enjoying building my beast. It does take some time, but I’m going to have an awesome thing to hang from the ceiling of my classroom.
I recommend volunteering in a way that will help you network for a job. Political campaigns have a good reputation for this, and the timing couldn’t be better. If you’re not partisan, there are nonpartisan get-out-the-vote efforts. Other options are community events (e.g. planning for a festival), libraries, museums, food banks. Your local United Way may offer a service that recommends volunteer opportunities based on your interests, skills, and availability.
If you have friends or family with kids, make it known you’re available to babysit. At least around here, good sitters are scarce at any price.
when not doing job search related activities, i’ve been doing the volunteer thing. i get to do data entry at the local campaign headquarters. can’t beat learning a new computer software.
i also have a ton of craft stuff in my house, so once the campaign is over, i’ll have some stuff to do at home as well.
Hey, neat link, leafrog. Model building’s been mentioned already, but here’s one variation: paper models. There’s a variety of free patterns at this link and there’s a Star Wars AT-AT here. Download, print and get to work. Just a little searching will find all kinds of stuff: I’ve seen steam locomotives, airships, whatever interests you. If you like science fiction models, a friend of mine makes stuff out of scrap: deoderant containers, blister packs, toothbrushes, pill containers, ad infinitum. Just stop throwing that stuff away, glue it together and paint it. (Works for him; I’m not that talented.)
Ha! This is SO true. And if you’re creative, you can get yarn and the other necessary instruments of construction for pretty cheap.
As a knitting addict, I’ve learned that it’s true…men knit. Specifically, for some reason, men knit socks. Socks must be manly or something, I don’t know.
But the gist is that you can get enough yarn for a couple of dollars at Walmart to keep you entertained for many hours. It occupies your mind and your hands and you’ll end up with stuff you can give away as gifts. If you poke around your area on the web, you’ll likely find someone who’s dying to offload some of their yarn stash and/or loan you some needles. You can get tons of free patterns and instruction on line.
Socks are supposed to be the most difficult thing to knit, but once you know the method it will seem simple and obvious (you wouldn’t even really have to learn how to purl). And while sock yarn may produce an expensive pair of socks (from $6-20/skein) it provides for a cheap project and a great entertainment /time and fun ratio.
Scarves are an obviously easy and “giftable” project. You can also do stuffed animals for cheap, using only bits of yarn. Afghans would cost you more, since they take more yarn, but they’re also a great way to thriftily use up extras you can scrounge. And they’re great for beginners.
So, do you not need a job? You don’t seem very concerned about running out of money or anything. Lucky bastard! I’m unemployed, as well, and am stressed out to the point of nausea! My “hobby” is looking for a job for eight hours a day.
I don’t play D2, but I’d be wary of online multiplayer in a game that old. The people who still play older games multiplayer tend to be pretty hardcore (read: highly skilled and not particularly welcoming to newcomers).
WoW can be very time-intensive if you want it to be. Once you’re set up, it costs a flat $15 per month; the only additional charges that can accrue are from paid name changes and paid server transfers. There’s also a free trial that lasts like 10 days or so, but some restrictions apply (such as communicating and trading with other players). The SDMB has a WoW guild; I’m not in it but I’ve read that they’re very welcoming of newcomers.