How do you do this... transparent paper effect?

Alright, saw this on one of kin's sigs, this was the first one I found, hope you don't mind kin, anyways:

as you can see, it's got a white line through it, it looks pretty awesome.

How can I achieve this? Thanks.

 

Make a rectangle selection and then with a white soft brush (round would be your best bet), brush so only part of the brush goes into the selection.

 

there are multiple ways the one jack said would be perfect an here is another way.
you can use the fuzzy brush then take the pen tool or the marque tool an delete half or more, then lower the opacity. an maybe change the layer style if necessary.

 

This is pretty popular with branding logos.

I usually just make a wave through it with the pen tool; and around the top to make a closed path,then create a clipping mask for the layer, then make the selection a slightly lighter color than that of the bottom.

if that makes sense >.< I'm not explaining this very well.