Swag means valuable items (jewelry, items, etc.) (ex1)
It's also used as a catchphrase. (ex2)
some guy: "Hey, I got swag."
other guy: "stop trying to be cool. It ain't working."
Soulja Boy:"I'm so fresh, you can suck my nuts! Swag!"
Darrel: You got so much dick in your ass
Assface Magee: Fuck you, SWAG
Me: 'That's because you're a fucking retard trying to be like the rest of the try hards thinking their dumb ass have swag.'
The word quickly made its way to the states and has ever since become the catchphrase of douchbags and tools everywhere.
Person 2: "You're a dick"