Don’t worry, you aren’t inebriated. Looking at the grid above you should see small sets of faint gray circles fading in and out of focus. A surface explanation of what is happening is a luminescence competition.
Instead of viewing the image above as intentionally distinct black grids, imagine it as sets of white horizontal and vertical lines placed on top of a black background. The combination of the background and foreground in the Herman Grid create what is called an equiluminant-weave. A weave is a class of stimuli consisting of intersecting vertical and horizontal bars. There are two types of weaves, a luminance-defined weave and an equiluminant-weave. A luminance-defined weave occurs when shapes and patterns of vertical and horizontal bars have different luminance levels. An equiluminant-weave occurs when shapes and patterns have equal luminance levels. The grayish spots you see on the image result from light levels competing for your eyes’ focus between the horizontal white bars and black grids.
For more variations of the Herman Grid go to: http://www.schouppe.net/hello-world and click Flash-animation.
Hamburger, K., & Shapiro, A. G. (2007). The Hermann grid is an equiluminant weave [Abstract]. Journal of Vision, 7(9):236, 236a, http://journalofvision.org/7/9/236/, doi:10.1167/7.9.236.