So the wisdom of what is 'I' and 'mine', as well as what is 'this' and 'that',
(The first) is life-wisdom (and) the other is to be regarded as sense-wisdom.
Commentary
In this verse the sage distinguishes between wisdom pertaining to life (the living entity as a whole) and wisdom pertaining to the senses. The first comes from within us, being related to us directly, and this is why we understand and relate ourselves to 'I' and 'mine'. The second comes from within the individual and is connected with the senses, 'I see this hut,' 'That drum is mine,' etc.
Both forms of wisdom are conditioned, because as Narayana Guru has already declared in verse one, "Wisdom without this conditioning is what is without egotism, etc." In the next verse the sage describes unconditioned wisdom. This is the wisdom that brings spiritual freedom. The Vedantaparibhasha (VII. 14) also speaks about two types of wisdom called rotating-wisdom (writti-jnanam) and observing-wisdom (sakshi-jnanam). What moves or rotates outside is 'this' or 'that', and what inwardly observes is 'I' or 'mine'.