With our senses more or less turned off, where do the conscious-like perceptions of dreams come from?
Science Daily reported
during sleep, the reactivated memories of real-time experiences are processed within the brain at a higher rate of speed. That rate can be as much as six or seven times faster (than) “thought speed.”
Memory stores patterns of activity in modular form in the brain’s cortex. Different modules in the cortex process different kinds of information - sounds, sights, tastes, smells, etc. The cortex sends these networks of activity to a region called the hippocampus. The hippocampus then creates and assigns a tag, a kind of temporary bar-code that is unique to every memory and sends that signal back to the cortex.
Each module in the cortex uses the tag to retrieve its own part of the activity. A memory of having lunch, for example, would involve a number of modules, each of which might record where the diner sat, what was served, the noise level in the restaurant or the financial transaction to pay for the meal.
But while an actual dining experience might have taken up an hour of actual time, replaying the memory of it would only take 8 to 10 minutes. The reason is that the speed of the consolidation process isn’t constrained by the real world physical laws that regulate activity in time and space.
The brain uses this biological trick because there is no way for all of its neurons to connect with and interact with every other neuron. It is still an expensive task for the hippocampus to make all of those connections. The retrieval tags the hippocampus generates are only temporary until the cortex can carry a given memory on its own
The initial creation of the tag is made through existing connections. In order to do the rewiring necessary to have the intermodular connections carry the burden takes time. What you have to do is reinstate those memories multiple times. Every time you reinstate the memory, the modules make a little shift in the connection . . . something grows this way, grows that way, a connection gets made here, gets broken there. And eventually, after you do this multiple times, then an optimal set of connections gets constructed
His previous research has show that cells that fired during activity prior to sleep, also fired in the same sequential patterns during sleep. During sleep, the hippocampus sends little, 100-millisecond bursts of activity to the cortex as much as three times per second.
This may be a way to explain dreams. There are other ways too. In this hypothesis, memories are first stored in a consciousness like form, a working memory. Then they are stored in a temporary form in the hippocampus, and then during sleep they are replayed until they are stored in throughout the cortex. This replaying produces dreams (at least if you are awoken during the process). The hippocampus probably has a limited capacity to store unconsolidated memories and therefore sleep is required at some point or the memories begin to be lost.
The hippocampus is essentially the edge of the cortex in the temporal lobe region and it is associated with two important functions: forming new memories / consolidating recent ones, and processing spatial information. People without an intact pair of hippocampi suffer anterograde amnesia, variable retrograde amnesia and an inability to navigate through a cognitive spatial map.