In this passage, we see a transformed hobbit who has undergone significant changes since his early adventures. The character reflects on how different he has become, shedding his old self with all its naive habits. The absence of a pocket-handkerchief symbolizes not only his growth but also the trials he has faced on his journey.
This development indicates that the hobbit has evolved from a simple, unprepared individual into someone more experienced and resilient. The mention of the pocket-handkerchief, once an essential item, highlights the contrast between his past and present, marking a clear transition in his character and life choices.