Where can I learn about how to create homemade electronics
The book "The Art of Electronics" is said by most people to be about as good an overall practical guide as you can get. Apparently good for beginners on up. So far I have never seen a copy so can only tell you what others say but opinion is almost all very positive. 
A good simulator such as LTSPICE will help.

"SPICE" programs allow you to emulate real world circuits with an accuracy that is usually stunningly good. You can add test points, change components, do what if tests etc. There are many much easier ways to get a rough feel for how circuits work byt a top SPICE program is  one of the most effective. The very good ones are also very expensive. But about the very best one is free!. LTSPICE !!! It's a way for LT to promote their products, and it's rolled in with their switching regulator design system - which is not a problem at all. It knows more about their components than others but as  a general purpose SPICE emulator it is very very very good.

See numerous references at end.

But, there is no substitute for "playing"  ... 
As for knowing what a circuit does - I just look at it and see :-). ie - like most difficult things in life "ALL" you need is practice, immersion, involvement, reading, playing, building, doing it, doing it, doing it ... . I cannot read music - except to slowly pick out notes on a piano. A guitar is  a twangy thing in my hands, a banjo  alas is a jangly thing in my hands, a violin a shrieky thing, and a flute and a tin whistle sound too similar when I extract sound from them. But when I look at an electronic circuit it's usually reasonably obvious at a glance what it is meant to do and how and after a little study, how it could be done better or cheaper or just differently. If I had spent as much time with music and instruments as I have with electronics I could probably read music but seldom need to, and play a large range of instruments. Lack of application, immersion and dedication and practice has ensured that all I will ever do is appreciate some music.
Even this :-} .


Read good books. Get a "breadboard" and some basic parts. Work out what sort of simple circuits may interest you and BUILD them and play.  

You can do half of all the things you are liable to want to do wity electronics in the first year of serious playing using only the ICs: LM324, CD40106, MC34063, and a few bipolar and MOSFET transistors and some R's C's and L's.

But, start with "The Art of Electronics". 

LTSPICE:

Getting a copy of LTSPICE and learning how to use it may also transform your life

LTSPICE home page

Getting started

Yahoo Groups LTSPICE page

LTSPICE tutorials

LTS Wiki

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