Dip peaches in boiling water, one at a time for 30 seconds. Run under cold water. Peel. Cut into 4 or 6 wedges each. Discard pit, repeat for other peaches.
Pour sugar and vinegar into saucepan. Tie spices in double layer of cheesecloth; add.
Bring to a boil. Cover. Boil slowly for 5 minutes. Add peaches.
Cook, uncovered for about 5 minutes until soft. Discard spice bag.
Pack peaches into hot sterilized jars to within 1 inch of top. Fill jars with syrup to within 1/2 inch of top. Place sterilized metal lids on jars and screw metal bands on securely. For added assurance against spoilage, you may choose to process in water bath for 10 minutes.