To add on to what I.RonMann said, Green polishing compound is great for putting a final edge on cutting tools (though, haven't tried it on HSS lathe tools). I don't use it under power (though I have tried in the past. What I did was made a strop by gluing a piece of soft leather to a small piece of hardwood, then rub liberally with green polishing compound. Take a few strokes on one side of the blade, then flip it over. Do that till the edge becomes shiny. Only takes 30-40 seconds. I have started doing this for my girlfriend (she is an amateur wood-worker), and it gets chisels and things scary, I'm afraid to even pick this thing up because I might cut my own arm off and not notice it for 20 minutes, sharp.
Back on topic, for lathe tools, I have a small india stone (think it is 4x1"). Few drops of oil and a couple strikes, and the HSS cutters I have are good. I have also heard arkansas stones are great for this, but I haven't broken down a gotten one yet...