Christoph von der Malsburg proposes a new theory of brain function, addressing the limitations of conventional localization theory. The main issue with localization theory is its inability to express relationships between active cells, such as their representation of the same object. The new theory introduces synaptic modulation, where synapses switch between conducting and non-conducting states, controlled by correlations in the temporal structure of cellular signals. This mechanism, along with refined synaptic plasticity, supports both short-term and long-term memory. Correlation dynamics shape network structures, enabling the brain to represent objects and solve the figure-ground problem. Synaptic modulation provides flexibility, reducing interference between memory traces and increasing memory capacity. The theory also addresses the invariance problem by allowing the brain to recognize objects despite variations in appearance. The brain is viewed as a network of cells and synapses, with correlations forming the basis for structure and relationships. The theory suggests that the brain's function is governed by general principles, with self-organization playing a key role. The new theory offers a framework for understanding brain function, emphasizing the importance of correlations and dynamic interactions in neural processing.Christoph von der Malsburg proposes a new theory of brain function, addressing the limitations of conventional localization theory. The main issue with localization theory is its inability to express relationships between active cells, such as their representation of the same object. The new theory introduces synaptic modulation, where synapses switch between conducting and non-conducting states, controlled by correlations in the temporal structure of cellular signals. This mechanism, along with refined synaptic plasticity, supports both short-term and long-term memory. Correlation dynamics shape network structures, enabling the brain to represent objects and solve the figure-ground problem. Synaptic modulation provides flexibility, reducing interference between memory traces and increasing memory capacity. The theory also addresses the invariance problem by allowing the brain to recognize objects despite variations in appearance. The brain is viewed as a network of cells and synapses, with correlations forming the basis for structure and relationships. The theory suggests that the brain's function is governed by general principles, with self-organization playing a key role. The new theory offers a framework for understanding brain function, emphasizing the importance of correlations and dynamic interactions in neural processing.