The little green squares on the left under your avatar when you post. Right under comments. Rep can be given through clicking the traditional balance symbol right under that next to the report post (caution symbol) and online dot.
Reputation should be given for good information, and I think the ideal is that it displays whose post should have more weight than others when giving educated answers - it's a good system when paid attention to, given that anybody can post here. For example, if someone with grey neutral reputation bars (one that has no rep points) gives a conflicting opinion to say, someone with 11 bars like our beloved moderator Kaysie, the reputation bars may give some clue as to what information can be trusted.
That's the reputation system as I view it. Someone who knows what they're talking about or gives good answers on the subjects they know will earn reputation quickly. People can also receive red (negative) rep, which should indicate that they may not be trustworthy in their information. Excepting John. He apparently, as previously posted, just likes the color red.
You can see where you have received reputation and on what posts up at the very top green bar by clicking "user cp."