William Farley will no longer be minding the knitting at Fruit of the Loom. On Aug. 30, the company announced both that its flamboyant executive was giving up his post as CEO and that earnings for the maker of T-shirts and underwear would fall "significantly below" Wall Street estimates for the rest of this year. Since Farley, briefly a Democratic Presidential wannabe, took control of the company through a leveraged buyout back in 1985, the undergarment company has been slowly unraveling. Lately, production and customer service snafus caused a 12% dip in first-half sales, while the stock has fallen from a peak of $48 per share in 1993 to less than $7 recently. "He ran a great business into the ground," says one investor who continues to hold the stock. Farley, who could not be reached for comment, will nowoccupy the newly formed "Office of the Chairman" with two other members of the board, says Dennis Bookshester, a director who will assume CEO duties until a permanent replacement can be found.

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