There was a great thread on this subject not long ago - she used the Green T extruder to make the individual strings then joined them together. I cannot remember who posted the instructions though - have you done a search? ( I am going now to see if I can find it......)
when I made my graduation cap cake (see my pics), I didn't have an extruder. I made a long, thick rope of fondant/gumpaste and then scored it with a knife longways to look like the strings of the tassel (but didn't cut all the way thru). then put the finishing touches on, ie the button on top, etc
they are usually sold in craft stores in the modelling clay area
hobby lobby sells them. You put the multi hole disc on, twist the crank until the paste is the length you want, cut the end and round off, take out a string and wrap around near the top, your done. A HL the extruder is about $29 and then with your coupon of 40%, it is worthwhile.
Here's a link to the tutorial for making a pillow, which shows how to make a nice tassle. HTH 
http://cakecentral.com/article66-How-To-Make-A-Pillow-Cake.html
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