The Collaborative International Dictionary of English v.0.48:

Swag \Swag\, v. i. [imp. & p. p. Swagged; p. pr. & vb. n.
   Swagging.] [Cf. Icel. sveggja, sveigja to bend, to sway,
   Norw. svaga to sway. See Sway.]
   1. To hang or move, as something loose and heavy; to sway; to
      swing. [Prov. Eng.]
      [1913 Webster]

   2. To sink down by its weight; to sag. --Sir H. Wotton.
      [1913 Webster]

            I swag as a fat person's belly swaggeth as he goeth.
                                                  --Palsgrave.
      [1913 Webster]

   3. To tramp carrying a swag. [Australia]
      [Webster 1913 Suppl.]