Character quotes is what different Characters say about in-game items or objects, or during certain gameplay events.
The player can alt-click items and objects to examine them.
When announcing or examining something (or chatting in DST), a character will always have that piece of text above their head for 2.5 seconds [Verification Needed], unless interrupted by another thing to say.
Lucy the Axe speaks with red text that appears below characters, to avoid confusion with characters's white text.