This is when someone is talking about some aspect of themselves, but the content of what they say is actually an expression of the aspect of themselves they are talking about.
Oden: Sometimes I think I'm paranoid, but then I realize that's ridiculous because that thought is probably just coming from the chip the government implanted in my ear when Loki knocked me unconscious at the bar yesterday.
Freya: Well if that isn't some recursive character expression!