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Nick's judgments reveal a number of things about his character.
In a functional sense, the fact that Nick's perspective is subjective and not objective. This is important for the reader's understanding of the narrative. The content of the novel is not objective fact but is intead observation.
...Nick is a romantic, moralist, and judge who gives the reader retrospective flashbacks that fill us in on the life of Gatsby and then flash forward to foreshadow his tragedy.
Also, thematically, this is a story of instruction and Nick is the figure who learns lessons, both moral and practical. Nick's view of the world at the opening of the novel is not the same as it is in the end. This change is clear only in Nick's evolving judgments of the people around him.
In particular, Nick's respect for Gatsby's dedication to a single dream demonstrates the notion that Nick is able to avoid becoming a true cynic. He holds on to some hope, for himself and for others, that dreamers can suceed. This judgment of Gatsby is telling and is arguably the central moral lesson of the novel.
NICK BEGINS BY EXPLORING HIS OWN PAST AND THE ADVISE THAT HIS FATHER GAVE HIM ABOUT BEING NON-JUDGEMENTAL. THIS IS THE PROBLEM THAT POSES ITSELF FOR ME. NICK SEES THIS NONJUDGEMENTALISM AS A VIRTUE MUCH LIKE MULTI-CULTURALISM SEES OPEN MINDEDNESS TO OTHER CULTURES AS A VITUE. THE QUESTION ARISES IN BOTH CASES: IS IT A VIRTUE OR SIMPLY A LACK OF MORAL COURAGE TO TAKE A STAND. NICK IS CONFLICTED IN THAT HE LACKS A BELIEF SYSTEM TO TAKE A STAND AND FINDS A WAY OUT BY REMAINING TRUE TO HIS FATHER'S PERSPECTIVE. IN THE END, HIS RETURN TO THE MIDWEST SHOWS WHO HE REALLY IS. HE EMBRACES HIS FATHER'S TRADITION OF NON-INVOLVEMENT(COWARDNESS) WHILE FEELING SUPERIOR(NON JUDGEMENTAL)
NICK REACHES SOME SELF KNOWLEDGE. HE SEES SOMETHING WONDERFUL IN GATSBY, THE ABILITY TO ACTUALLY BELIVE IN SOMETHING AND RISK ONE'S LIFE FOR THAT BELIEF. NICK'S FAILURE TO CHANGE AND HIS RETREAT SHOWS WHO HE REALLY IS, AN OBJECTIVE OBSERVER. HE IS A COWARD. CONTRARY TO HIS OWN BELIEFS, HE IS VERY JUDGEMENTAL OF OTHERS. IF HE IS JEALOUS OF JAY GATZ ITS GATSBY'S ABILITY TO ACTUALLY BELIEVE IN SOMETHING, NICK IS LIKE THE GREAT BULGING EYES LOOKING OUT AT THE WASTE LAND, EYES WITH NOTHING BEHIND THEM, NO BELIEFS OR VITUES ONLY SELF SATISFIED OBJECTIVITY.
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