This is my 1986 Cannondale ST that I recently finished building.
I bought the frame for $30.00. It was complete except wheels, seat and fork. It included the original Cannondale aluminum rack.

I had a set of 700c Wolber with Suntour GPX hubs and a 7sp freewheel. These I bought at a neighborhood yard sale ($35), along with another set of wheels, misc. items and a full GPX grupo. The neighbor across the street had a Thule set up, 4 gutter mount feet, 2 bike racks, 2 ski racks, 2 bar sets (one long) and a basket that I got for $30

I removed the Suntour 6spd Accushift components and replaced them with the GPX f&R derailleur and shifters for the 7sp freewheel.

I found a new carbon fiber threaded fork at Chucks Bikes for $33(with shipping). I got a new headset locally, nothing special, ($10.00) I really just needed the race for the fork

The Selle San Marco Gel saddle was $10.00 at a LBS

The Speedplays are from my 1982ish Nuevo Record Bianchi that I bought for $60.(another story)

The new tires and tubes were $50.00.

The period correct panniers I picked up at another yard sale for $4.00.

I took it for a 35 mile “shake down” on Saturday and everything worked well. I think I am going to enjoy this one for a while.

I do have a question. What is the peg on the inside of the RH seat stay used for?

That peg is a "chain hanger".

Hang your chain on that when you remove your rear wheel. When you remount it, you will certainly appreciate the convenience of having the chain out of the way.