From what I've read on WetWebMedia.com, I have come to the conclusiong that it isnt reproducing. I think that it just might be spitting out its guts. But the thing is that I dont feed it, well not directly atleast. I feed my fish 2 - 3 time daily (mysis,brine,c.eeze,flakes,seaweed) and usually the clowns hosting it bring it back food. However the other day it grabbed one of my chromis's and ate it.
According to WetWebMedia, the deflated tentacles that my anemone has is a sign of the it spitting out its guts.
If anyone has kept a sebae over the long term, please give me some feedback.