It's in the ($45,000) Bag

March 16, 2007— -- Sitting in her London loft, surrounded collection of handbags, Jasmine Lennard says, "It sort of means you've achieved a certain level of success if you've got a certain type of handbag."

Even though "£20,000 [about $39,000] for a bag is insane. You know, I see that when there are children starving," Lennard continues. "But I work for my beautiful things."

Like Lennard, many others also appreciate the importance of a handbag.

"We were told by one of our consumers that if there was a fire in her house, the one thing she would save would be her Mulberry handbag," says Lisa Montague, Mulberry's chief operating officer, "which I found, in one way, quite shocking."

In another way, that's sweet, sweet music. "Women are willing to pay more and are more passionate about bags," says chief industry analyst Marshal Cohen of the NPD Group, a market research firm. "They now call them an investment."

Mulberry sales are up 44 percent year-on-year, and the quintessentially English brand has just opened stores in New York and Los Angeles. The U.S. handbag market is worth around $6 billion a year and growing. Designers push their bags in magazines, and models often carry handbags on the runways of fashion shows.

And then there's Louis Vuitton's new Tribute Patchwork, a collage creation made from some of the fashion house's iconic bags. The Tribute Patchwork retails at around $45,000.

The (male) psychologist's view? "I would say anybody that pays $45,000 for a handbag is trying to make a statement. It's an aspiration thing," says Ben Fletcher, a professor in the University of Hertfordshire's psychology department.

Back at Lennard's apartment, she unpacks a brand new Louis Vuitton bag. I naively ask if she might use the shoulder strap provided. "I'm not a fan of shoulder straps," she says with raised eyebrow. "I think it's a little bit peasant."