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Jim’s most valued possession was his watch, and Della’s was her hair.
Jim and Della were a young couple who loved each other very much, but were not wealthy. What they did have they valued highly. Jim placed great importance on a gold watch that had been passed down through the family for generations. Della did not have a personal item she valued, but she valued her beauty, especially her hair.
Now, there were two possessions of the James Dillingham Youngs in which they both took a mighty pride. One was Jim's gold watch that had been his father's and his grandfather's. The other was Della's hair.
The day before Christmas, Della is upset because she has only managed to save “[one] dollar and eighty-seven cents” for Jim’s present. They only have twenty dollars a week, and she does the best she can but the money did not stretch as far as she had hoped this year.
Della goes to Madame Sofronie "Hair Goods of All Kinds” and sells her hair for twenty dollars. Her hair is her most valued possession, but she does not value it as much as her love for her dear husband. All she can think of is getting him something nice. So she sells her hair and buys a “a platinum fob chain simple and chaste in design” for his watch, his most valued possession (next to her of course), to show him how much she loves him. It costs her twenty-one dollars, which is almost all she has.
Although Della is afraid Jim will think she looks like a “Coney Island chorus girl,” she is excited to give him the present. She worries that he might not think she still looks pretty. When he comes home—late—he is completely shocked at her appearance. She is angry at his stunned reaction to her, but there is more to the story. She finds out why when she sees the present he got her.
For there lay The Combs—the set of combs, side and back, that Della had worshipped long in a Broadway window. Beautiful combs, pure tortoise shell, with jewelled rims—just the shade to wear in the beautiful vanished hair.
He is baffled by the absence of her beautiful head of hair because, just like her, he went out and spent extravagantly on a present based on the thing she loved most (other than him of course). He bought her combs for her beautiful hair—the hair she just sold to buy him a fob for his watch. But how did he pay for these very expensive combs? He sold his watch.
The narrator says that these two are the wisest gift givers, because although they were foolish, they each sacrificed what mattered most to make sure the other was happy. So they were wise fools. This is the irony of the story. What these two learned is that you do not need wealth to be happy. The wealth they had was in the fact that they loved each other, not in money.
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