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With more than a little disappointment, I sold off my holdings in PAUH. Unfortunately the Company has been hit with a double whammy. The obvious one is the overall meltdown in retailers recently. But more influencial in my decision was the apparent sanfu by management.

Back in October, the Company stated something to the effect that they were going to cut back on promotional selling. I had a bad feeling back then. I should have bailed at that time because management was changing the successful formula that attracted by investment in the first place. The result is that critical same store sales decelerated in both October and November. And November was an absolute disaster.

I recognize and hope that management can get its act together and turn the boat around. But I realized that by taking todays loss, I could buy myself about $2.00 of share appreciation. If it looks good, I can get back in without much risk of being behind (i.e. my tax savings by recognizing todays loss equals about $2 per share).

I just felt that even if sales do improve, it will take some time before big money investors return to drive the stock significantly higher. And I am fearful that this stock will get pulled down in a big stock selloff that could occur in January if those big stocks report disappointing earnings. I feel safer on the side lines until the dust settles.

As for PAUH, I can't believe they thought shoppers would keep piling through the doors without promotional sales. My wife and I have shopped a couple PAUH stores. They were nice, but don't have a franchise that would allow them to turn women's apparel on its heels.

IMO. Bill
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