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According to Freud, dreams are spyholes into our unconscious. Fears, desires and emotions that we are usually unaware of make themselves known through dreams. To Freud dreams were fundamentally about wish-fulfillment. Even "negative" dreams (punishment dreams and other anxiety dreams) are a form of wish-fulfilment; the wish being that certain events do not occur. Very often such dreams are interpreted as a warning.
Freud believed that although our dreams contain these important messages, they are encoded - disguised. The unconscious mind doesn't speak any verbal language therefore it must communicate with us via symbols. Some of these symbols are near-universal, others very personal to us and our individual life experiences.
He began studying as a doctor then specialised in psychiatry. In 1896 Freud coined the term psychoanalysis to refer to the study of mental - as opposed to physical - causes of psychiatric disorder. He is thus known as the father of psychoanalysis ("the talking cure").
Much of Freud's work is today considered dated or suspect, however there is no denying the influence he has had on modern psychology and personality theory. Even those who reject Freud's theories will usually accept that he has had some influence on the evolution of their own approach.