Step 1: Prep Your Silkscreen Station
Take your colors and position moderate sized globs of the stuff above your design. Be sure to make the size of the globs touch! I used three colors on this design, but feel free to go crazy and do any number in any combination that you want.
Step 2: Blend the Colors
Step 3: Flood Like Normal.
Step 4: Aaaand Paint!
The third picture shows how much the paints blend after multiple passes. (I squeezed the third pass between the first and second, just in case you think I mislabeled things.) The blending is most noticeable in the "h" in "Shop."
If you're interested in learning how to do the whole silkscreening process, check out the Silkscreening SBU over at TechShop!