Does anyone know what the rainbow over GC's head does?
I can manipulate the little bugger to produce "rainbow brain" but I cannot figure out what happens when the rainbow appears...
singing2m3

When he does it on his own, he usually is doing something special, like restoring the berry bush/crops, moving a boulder, making a party or more. When you make him do it, it usually has no effect.

I have seen him do it when he is standing in the lagoon and ocean...

It is just a "cute" little thing he does. And again usally when he does it on his own accord something happens, and it will tell you what in the Action window. But sometimes it has no effect.