It' mostly traditional thai meterials but basically the yellow paint is something that could be wash off with water and the cloth ball is used to apply some kind of glue (traditionally sap from a plant) to bind the gold leaf to the surface. Then when washed with water the part that is applied with the yellow water soluble material will be washed off so you will be left with the desired pattern which is the part not applied with the yellow thing. More information here en.m.wikipedia.org/wiki/Lai_rot_nam