Crick verbatim On The Function of REM Sleep
Suppose one did not have REM, then one would mix things up. That is not necessarily a bad thing - it is the basis of fantasy, imagination, and so forth. Imagination means seeing a connection between two things that are different but which have something in common which you had not noticed before. If one had too much REM, one would predict one would be a rather prosaic person without too much imagination. But the process is not 100% efficient. If one goes on too far, one begins to wipe out everything.
Another way to look at it is to say "How could you prevent the brain being overloaded"? One way would be to make it bigger, to have more neurons. So perhaps the important thing to say is "The function of REM is to allow your brain or your cortex to be smaller".
Read more about this topic: Reverse Learning
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