Grey, as in no new notifications and 1 and 0
Then you have no notifications, you have 1 badge to give and you have received zero badges from other Hubskiers. You now have a badge to give to another Hubskier if you so choose. This could be for a post or a comment that you deem worthy. Once your wheel goes around fully, what you receive is the ability to give a badge. Does that make sense? Also, you should now be able to add community tags to posts, see the +# next to other peoples posts? Welcome to the club. Let me know if this answers your questions.
Oh, so LEFT to the wheel I see the badges I own currently to give away, and RIGHT to the wheel I see the total number of badges I've received from other people? Or can't you pass on the badges you get from other people? I guess no, to avoid inflation, that makes sense... Yes, the tag thing works, that's why I was extra confused! Also, a graphical glitch in Opera makes it look like the left number belongs to the notifications, that was extra confusing too I guess: