When making friendship bracelets, we are using a fiber arts technique known as "macrame". Macrame is an organized system of making knots to create anything from bracelets to scarves, or even creations beyond your wildest imagination, as you'll see from the artist inspiration at the bottom of this post.
Materials - Yarn (or string, embroidery floss, hemp cord), scissors, tape
In recent years, there has been a resurgence of the use of traditional crafts amongst contemporary artists. Ernesto Neto is a Brazilian artist who uses macrame and crochet to creates large scale works of art. Much of his art works are large interactive environments that people can enter into.