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Oddly enough, plain ol' ordinary word processing does well. I use the MS Works that usually comes with my computer. It will mix text and graphics, so if it's a paper newsletter, you can do a two-column format, color photos and drawings, announcement boxes with color background, etc.
For on-line newsletters, Works can save a document to .htm. It'll do just a one-column format, but a graphics-text mix is still okay. The last time I checked, tabs were still a problem in .htm, so try to avoid them; also, usually only one line of text can go alongside a picture.
If your Internet company allows user webpages and blogs, then all the software you need might be at their end, and you don't need to use .htm. As an AOL customer, I went to hometown.aol.com and built a cheap-and-dirty homepage (at no additional cost!), then just pasted my text and graphics in. I mix single or multi-column text, each article is separately adjustable in format, it's not limited to one line by each picture -- and they throw in a hit counter. Not bad.
__________________
It wouldn't be right to dream, while
Forgetting to live, it seems;
Nor would it be right to dwell on life
And yet forget our dreams.
-If There Were No Magicians
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