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This is an interesting thread.  I, too, always wonder what "book" smart vs. "street" smart means in practice and how those types of characterizations translate to what processes are going on in our brains.  I would guess that "street" smart is a more intangible type of knowledge that is attained and realized through practice, say through interacting brains, and reflective thinking (linking Loops 1,2,and 3).  Although "book" smart is a type of knowledge that can be taught in a classroom, I believe that it's reinforced and enriched by the type of interactions that build "street" smart.  Are intelligent people (I would define intelligent as someone who is able to think critically to construct a thoughtful response to a question as well as to ask thought-provoking questions of others) able to use their "street" knowledge to  enable the development of new and deeper knowledge?