Take a look at this: the quality of knockoffs today is at a whole new level and that is causing tremendous problems for brands selling the real deal.

Fake bags have been developed so well they can trick nearly everyone.

And the market right now is booming, fueled by social media users and influencers showing off their hyper-realistic replicas.

Amy Wang is here with us now. She is an assistant managing editor for the New York Times Magazine and you wrote about this, Amy, welcome.

- So we're just gonna dive right into this 'cause you brought along two samples for us to basically examine. - Thank you for having me.

Okay, let's see.

We don't know. So is one of these fake and one of these is real?

That's the thinking unless you guys disagree.

They told me not to tell you.

You can smell it. You can fondle the bag. Do whatever you need to do to...

I have to tell you, I cannot tell. I mean, the stitching looks good on this, it smells like real leather.

I cannot tell. It seems real. Same as this. I look at the stitching and that seems to be good quality.

Any guesses?

- Doesn't quite smell like leather to me, this one. - I'm gonna guess...

This is Gucci. I'm gonna say, the smaller one is real, the larger one is fake.

Interesting. Would you agree?

No, I actually would have said the opposite that this is fake and this real.

Well, I guess this is a good moment to reveal that both of these are fake. The two bags are both counterfeit bags, purchased from China.

And this categorization (is) known as super fakes which are bags that are now so realistic that the average person or even an expert or even an authenticator or person at the actual boutique can't tell.

So what are you discovering about how bags are becoming super fakes now because I thought there used to be a smell test, there's a quality test.

I've exhausted everything that I know how to cut try and look at which is very minimal.

So what's happening? I know a lot of these bags (are) being manufactured in China.

Right, so we used to be familiar with this sort of Canal Street breed of bag where you're like "Oh, that's so clearly a fake bag." You know, the stitching's all off, the color is all wrong.

But there are a couple (of) factors that have contributed to the rise of super fakes. Two, on the demand side of things, one is that consumers are being asked to pay higher and higher prices, right?

Like a Chanel handbag actually costs ten thousand dollars or more now.

And that's an extraordinary price to ask out of people who are feeling squeezed, who are feeling impacts of a recession and might not have high enough salaries to even afford their their average daily life but would like a luxury.

And then secondly, they want to shop in a convenient way.

People are used to buying on Instagram, on AliExpress, on DHgate, on Amazon, so there's no real sort of fear of buying a good online now.

And if you're being advertised an ad on Instagram for a fake bag, you might as well take that up, right?

You're like, "Well, it's a hundred dollars. If I pay a hundred there for that and I pay a hundred dollars for a meal at a restaurant, what's there to lose?"

So these sellers in China are also getting very savvy at the same time and realizing they can advertise over these new sales channels.

And they're also getting better organized within themselves; the labor chains are better organized, the technology is better organized.

And then, of course, most importantly, the selling of it is just so easy when you can just create an ad on Instagram, put it out to a bunch of American women and across the globe seamlessly conduct the sort of sale that would not be possible before.

Yeah, so Amy, what does all this mean for designer brands themselves, how are they responding to those?

Yeah, so naturally, designer brands are pretty worried about how to address the problem and they're spending billions of dollars in these sorts of trade organizations, trying to counter and tackle counterfeits.

But U.S. customs, for example (to use one example of a border patrol group), only has so many people, and they can only inspect about five percent (that's estimated about five percent) of what comes into the border.

So it seems like a really great odd or great stakes for people who are interested in buying bags like you only have a five percent risk of getting something seized.

And I wonder if the perception of customers has also changed because there is a considerable markup for actual designer handbags, right?

It did not cost the company ten thousand dollars to make the handbag, so I'm wondering if consumers now have a lower guilt level in purchasing a fake. Have you found that?

That's exactly right. There have actually been some studies that Gen Z in particular is more interested than ever than any other generation in purchasing fakes,

and by some estimates, around 60 or 70 percent of young people of Gen Zers have bought consciously a counterfeit item and been happy about it.

They (have) intentionally gotten by the 200-dollar version rather than the 10,000-dollar version because they see it as a sort of subversive,

like, "stick it to the man," like, I don't want to give any more money to the bottom line of LVMH. I'd rather, you know, do something really subversive and cool.

So that kind of vibe is definitely pervasive amongst people.

I think people realize that as there's widening wealth disparity across the globe too, it's sort of difficult to be putting your money into something that you feel like you're not totally getting the value of.

Yeah, people I guess are becoming a bit more conscientious about what they're putting their money towards, but really fascinating to see I definitely got that wrong.

I think Elaine is taking both of them. Thanks for the gifts. Thanks, Amy.

Errol, we're not taking them. Amy, thank you so much.

Thank you so much for having me.