The sash is a basic waist-slot item. It is given by Inala as a reward for defeating Ratingar. The sash gives 2 defense and 1 belt slot that can be used to store anything but inventory items. Sholop buys sashes for 39 gold and sells them for 150.
The sash is probably the rarest item in the game, because each character only gets one, and most people sell them to sholop, who only keeps one or two... But they're worth like nothing because they're so easy to get, and have no practical purpose....