in this case, just means “yup” or “okay”
person 1: yo im bouts slide with some beer. got rainier
person 2: ight swag
Swag was invented by men the 60s and it means that you're secretly gay
Jade: im swag
Hannah: you're what?
Jade: swag!
Hannah: oh!!
me
Person 1: You’re so swag
Person 2: Awh thanks, have some blue