Here is the concerned reply -

Reinstalling doesn't delete the preferences and it's very important in lion and mountain lion to remove the prefs after a major version upgrade, like 10.6 to 10.7 or 10.7 to 10.8.

Go to your username>library>preferences and delete:

com.adobe.PhotoshopElements.plist

Adobe Photoshop Elements 10 paths

Adobe Photoshop Elements 10 settings

and any lockfiles with the same names.

That library is hidden in 10.8. To see it, in the finder click the Go menu and hold down the option key. It will appear below the little house for your user account. While you're in there go to the Saved Application States folder and delete everything for PSE.

It wouldn't hurt to repair permissions, either.

From the post : http://forums.adobe.com/message/4679169

Thanks

Andaleeb

In the Finder, look for the Go menu:

Click it to open it, but don't let go of the Mouse button. While holding it down, press the option key and you will see the library appear below your user account.

It's in that library, but not in the preferences folder. Sorry if that wasn't clear:

If it works in your old account, you can now delete the new one. Let me know if you need help doing that.

Sure. Make sure you're logged in to your original account, then go where you were (system prefs>users and groups. If the padlock at the bottom of the screen is closed, click to unlock it, and give your OS X account password. In the list on the left side, click the name of the account you want to delete, then click the minus button below the list.

You will be asked how you want to delete: Delete Immediately does away with the account completely, or you can choose to have any files you created in the new account transferred to your own account. Be sure to lock things back up by clicking the lock again when you finish.

Let me know if you need more help.

Hi,

Just thought this might help - here's a matrix that lists out Photoshop Elements and Operating System versions: http://forums.adobe.com/message/4527508.

Cheers,

David