Cook giblets from turkey in about 1 1/2 cups of water (or you can use turkey broth).
Melt butter in separate pan.
Add water chestnuts, celery, carrot, onion, nuts, mushrooms (optional), sage, parsley, and salt & pepper to the bread cubes and mix well.
Pour melted butter evenly over mixture and mix with a large spoon until well mixed.
Pour a small amount of broth into bread mixture.
Stir well and gently squeeze a small amount of stuffing in your hands to see if it slightly sticks together.
Pour more broth in the stuffing until the stuffing is in the beginning stage of sticking together. Don't get it too wet or sticky (I ended up using the entire 1 1/2 cups).
Bake at 350 degrees in a covered casserole dish with tin foil on top of the stuffing for about 15 to 20 minutes.
Then, remove tin foil and lid and bake another 5 to 10 minutes until browned.