I like to us Liquid Hide Glue from Titebond 7or8$
old felt can be removed with hot water
I have rebuilt a number of machinist chests, most in tough condition. I typically take them completely apart and reglue the parts, sometimes replacing missing pieces. This is possible because the chests are assembled with hide glue that can be removed with hot water as discussed above. I have become a fan of using adhesives that can be removed without damaging wood. I reglue the wood parts with the modified hide glue bleonard uses, and install the felt with (premixed) wallpaper paste. I learned about wall paper paste in another forum from someone who worked on valuable antiques where reversible repairs are valued. The paste takes awhile to dry so you have some time to position the felt. It's tough to work on a chest where someone has used modern adhesives that make disassembly or felt removal without damage almost impossible.
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