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I've got an audio technica at 2020 usb condenser mic, it works really well, but I paid about $130 for it. I bet you can get it cheaper though.
As for a recording program... I use Ableton Live, I, ahem, legally bought it from a retailer. It's kind of complicated to use at first but if you take the little lessons it's quite easy and it has tons of synths and effects built in.
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