“The first thing that becomes clear to anyone who compares the dream-content with the dream-thoughts is that a work of condensation on a large scale has been carried out. Dreams are brief, meagre and laconic in comparison with the range and wealth of the dream-thoughts. If a dream is written out it may perhaps fill half a page. The analysis setting out the dream-thoughts underlying it may occupy six, eight, or a dozen times as much space. This relation varies with different dreams; but so far as my experience goes its direction never varies.”
Freud is essentially saying that the actual dream that a person remembers experiencing (the dream-content) is significantly shorter than the amount of material one can produce by analyzing the “dream-text” so to speak. Freud attributes this to a psychic act of condensation; dream-time is limited, so your unconscious is trying to blurt a lot of stuff out at once (while your conscious mind is trying to suppress it all) so stuff gets squashed together. The monster chasing you in your dream is both your fear of rejection, your fear of inevitable death, the absence of your mother, and your love of pistachios. While Freud attributes this multiplicity of signification to a psychic act of the unconscious, I’m not so sure. I think he may just be noticing a phenomenon of all texts, not just dreams. Isn’t this how all texts typically operate? Hamlet may only occupy a few pages in a book, but way more has been written about the play than the play itself encompasses (if we’re judging by word count, etc.). The moment that somebody speaks a dream aloud or writes it down, they’re putting an experience into language and generating a text. In my opinion, what Freud is really doing is not analyzing a dream, per se, so much as he is analyzing a text just like any other, albeit one that is considerably more abstract than we normally encounter (and therefore prone to infinite pluralities of signification).