October 1, 2004


Via Facsimile (973) 643-6500 and U.S. Mail

Steven R. Kamen, Esq.
Sills Cummis Epstein & Gross P.C.
One Riverfront Plaza
Newark, New Jersey 07102-5400
(973) 643-7000

RE:	Rag Shops, Inc.
	Schedule 14D-9; File No.: 005-42322
	Filed September 22, 2004 by Rag Shops, Inc.

Dear Mr. Weinsier:

The staff has reviewed the referenced filing, and has the
following comments.

General

1. Please add Rag Shops as a filing person to the Schedule TO
filed by Crafts Retail Acquisition Corporation on September 22, 2004
for purposes of Schedule 13E-3.  Because Rag Shops has recommended the
tender offer being made by Crafts Retail, Rag Shops is a filing
person for purposes of Schedule 13E-3.  See interpretation K.2 in
our July 2001 Telephone Interpretation Supplement publicly available
on our website, www.sec.gov.   Please note that only bidders may
appear on Schedule TO.  To the extent you believe that Rag Shops is not
engaged in a tender offer, Rag Shops must file a stand alone
Schedule 13E-3.

The Board Recommends that the Stockholders Accept the Offer and
Tender Their Shares Pursuant to the Offer

2. Please revise to disclose how the Company and the purchaser
group each reached the determination that the offer is fair despite
the apparent absence of the safeguards identified in Item 1014(c) and
(d) of Regulation M-A.  Refer to Q & A 21 in Exchange Act Release No.
17719.

3. Item 8 of Schedule 13E-3 requires a discussion of the material
factors upon which a belief as to fairness is based.  This section
should include a discussion of each filing person`s Item 1014(b)
analysis, including a presentation of all the material factors
considered by such party in reaching its determination.  If one
party relied upon the analysis of another, such as the financial
advisor, that party must expressly adopt the conclusion and analyses
of the other.  For example, if the board is relying on the financial
advisor`s analyses, and the analyses satisfy the Item 1014(b)
disclosure standards, the board must specifically adopt such
analyses as their own.  Filing persons cannot insulate themselves from
liability by relying upon the summary of the financial advisor`s
analyses which, by their terms, do not comply with the specific
disclosure requirements of Item 1014(b).  The board does not
appear to have specifically adopted the analyses of the financial
advisor in the existing disclosure.  Without expressing an opinion
as to whether the financial advisor`s analyses satisfy the Item 1014(b)
disclosure standards, the board must expand the discussion in support
of their fairness determination with regard to the transaction to
specifically address the Item 1014(b) factors. See Question and Answer
20, Exchange Act Release No. 17719 (April 13, 1981).

Schedule 14D
Past Contacts, Transactions, Negotiations, and Agreements
Mutual Releases, Funding Agreement and Escrow Agreement

4. Please expand your disclosure regarding the reason for the
funding agreement with Mr. Berenzweig and the nature of his obligations
and certain expenses to be covered under same.  We note that losses
are described in the funding agreement, but believe that your
disclosure should include a general description of these obligations.

The Background of the Offer
The Board Recommends that the Stockholders Accept the Offer and
Tender Their Shares Pursuant to the Offer

5. We note that four non-binding written acquisition proposals
were received by SunTrust on July 27, 2004, including the proposal
from Sun and three from other financial buyers.  Further, the board
instructed SunTrust to provide additional information to the
bidders and to solicit final and best proposals from each bidder.
Please expand your disclosure on the information SunTrust provided to
the three bidders that were not Sun.   We note that no revised offers,
other than Sun`s were received from other bidders, but believe
that you should provide more detail regarding the nature of
information provided to the three other bidders.

Reasons for the Board`s Recommendation

6. We note that your discussion of information and factors
considered by the board, including all of the material factors,
purports to include both positive and negative factors.  However,
only one apparently "negative" factor is cited in your bullet-pointed
list. Please tell us, with a view toward disclosure, if there are any
other negative factors considered that should be considered material
and included in this disclosure.  We note that lost opportunity to
participate in the growth and profits of Rag Shops following the
offer is referenced.

Closing Comments

      We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filings reviewed by the staff to
be certain that they have provided all information investors require.
Since the company and its management are in possession of all
facts relating to a company`s disclosure, they are responsible for
the accuracy and adequacy of the disclosures they have made.

	In connection with responding to our comments, please
provide, in writing, a statement from the filers acknowledging that

* the Company is responsible for the adequacy and accuracy of the
disclosure in the filings;
* staff comments or changes to disclosure in response to staff
comments in the filings reviewed by the staff do not foreclose the
Commission from taking any action with respect to the filing; and
* the Company may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.

      In addition, please be advised that the Division of
Enforcement has access to all information you provide to the staff
of the Division of Corporation Finance in our review of your filing
or in response to our comments on your filing.

      We believe that a supplement should be sent to
security holders to provide them with the information that will be
given in response to these comments.  In addition, please file
revised materials that clearly mark the changes made in response
to these comments.  The staff views responses to comment letters as
correspondence in connection with filings, and Regulation S-T
mandates the submission of such correspondence electronically.
Submit a cover letter electronically that keys your responses to
the comments to the changes made in the text, and provide any
requested supplemental information.  If you believe complying with
these comments is not appropriate, tell us why in your letter. We may
have further comments after reviewing your revised materials and
responses.

	Direct questions to me at (202) 942-2903.

					Very truly yours,



					Celeste M. Murphy
					Attorney Adviser
					Office of Mergers and Acquisitions