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In this chapter we are introduced to Demian who is one of the protagonists of the novel. He is a new boy who joins school and is in the same class as Sinclair, since he wears a mourning band, we knows that someone close to him has died. We later come to know that he lives with his mother and there is no mention of his father in any part of the novel.
The teacher in class, tells the students the story of Cain and Abel. This is a Biblical story of two brothers. Cain kills his younger brother Abel. Thus Cain is despised by religious people and religious teachers. He is considered a villain. But Demian's interpretation is quite different. According to him, Cain was stronger and he killed his younger brother, who was weak. He does not see anything wrong in that. It is the victory of the stronger over the weaker. It is further known that Cain had a mark on his forehead. His children too had such a mark. This too is despised by the religious people. Cain's mark is said to have scared people. For this too Demian has a different and unconventional interpretation. He says that this was a mark of distinction. People were afraid of Cain and his children because they (Cain and his children) were powerful. Therefore they considered them strange. According to Demian there is nothing derogatory about the mark. Since Sinclair comes from a religious background he is not comfortable with Demian's interpretation. He wishes to hold on to the conventional beliefs, whereas Demian's interpretation indicates the need to transcend the conventional ideas of good and evil.
Above the doorway of Sinclair's home, there is a design of the arms. Sinclair is not sure what it is but thinks that it is a bird. Demian points out that it is a sparrow-hawk. This shows that Demian is an observant person. Demian points out that it is a sparrow-hawk. The sparrow-hawk is a recurrent symbol throughout the novel. We are first introduced to it in this chapter. It is a combination of innocence, gentleness and cruelty. It thus depicts the coming together of good and evil, a sort of overlapping of the two realms, which have been mentioned in chapter one. The sparrow is a simple, gentle and innocent bird. The hawk, on the other hand is a cannibalistic bird. Above the doorway of Sinclair's home there is a design which looks like a combination of both these birds. Thus the two realms or the two worlds of good and evil, gentleness and savagery actually exist as one. Though the atmosphere inside the home is of peace and goodness, Sinclair starts living in the world of torture and guilt, which make him, suffer tremendously.
Demian realizes that Sinclair is worried. He tries to find out from him what is bothering him. Though Sinclair hesitates at first, he finally reveals that Kromer is harassing him. Demian is sympathetic and assures him that they will find a way to get him that they will find a way to get him out of the situation. Sinclair is relieved. When he goes home everything looks different to him. When a person's mind is at ease, the world outside definitely looks better. Now Sinclair has hope that there is someone to help him. Someone who is willing to listen to him without persecuting him. By making a confession, he has thrown out from his mind, that which was bothering him. The system of confessing (to the priest) among the Catholics is a religious dictate. It is based on the belief that the sinner or the confessor is granted forgiveness by doing so and thus he / she is freed from sins. However, it is also relevant to note that confession purges the mind from feelings of guilt and thereby grants relief.
Sinclair is at last free from Kromer, Demian has helped him. Thus Demian is like a savior. However Sinclair does not feel any gratitude for him. He has grown up in an atmosphere wherein hardly any importance is given to the feelings of the child. Since gratitude is a feeling, Sinclair thinks that gratitude cannot be expected from a child of his age. Actually Sinclair is a very sensitive child and has deep feelings.
At the end of the chapter, Sinclair’s father is shocked, when he is told that some people believe that Cain is better then Abel. Anything contrary to the established religious belief and interpretation is unacceptable. Sinclair's father considers blasphemous to even discuss such a matter. He thus warns Sinclair against such ideas and says that the devil is trying to destroy their faith.