The observer is a perspective, and the observed is his own perspective, otherwise he would not recognize the experience, and would not call it a certain type of experience.
The experience is already in him before he recognizes it.
The past, which is based on the self-image and the world-image, is in this way incessantly active, and it recognizes itself; the new is swallowed by the old.
Likewise it is the reaction, which determines the challenge. The challenge is the reaction, just like the observed is the perspective. The perspective is created by the reactions.
If there was no reaction the challenge would be new, or rather: there would not at all be any challenge and reaction, but only a state of creation, middle and fulfilment.