This article describes a new finding which relates memory loss and cognitive dysfunction to a loss of glutamate receptors in the prefrontal cortex (PFC):
They state that this is why the PFC tends to falter in the face of repeated stress: the receptors for one of the key neurotransmitters become depopulated, leaving fewer sites to accept the glutamate and allow that part of the brain to do its job.
Cognitive impairment in the face of repeated or chronic stress is not a monolithic problem, though. Memory and decision-making are probably the most complex of brain tasks, and there are plenty of things that go wrong when memory and cognition fail.
Other factors include dopamine depletion, leaving less of that transmitter to carry messages back from the PFC, thereby making executive decisions harder to make and still harder to follow through on. (I wrote a previous post on dopamine and decision making. I'll dig it up and link over.)
And then there's the adrenaline overproduction and overuse that characterizes chronic and repeated stress, leading to disruption of the hypothalamic-pituitary-adrenal axis (the body's entire signaling structure for body processes) which contributes to brain dysfunction in still more ways: by disrupting sleep, which disrupts memory formation and impedes logic; and by contributing to the rise of metabolic syndrome, creating less stable blood sugar -- which, in the brain, adds considerable insult to injury: a hungry brain is a low-functioning brain.
Take your vacations. Simplify your life. Move your body around regularly. Meditate early and often. If you cherish your brain, you might as well let it work -- and that means getting a half-Nelson on stress before it gets one on you.
The article on overuse of dopamine (on my Living Anyway blog): http://livinganyway.blogspot.com/2011/03/dopamine-poverty-and-pain-lighter-side.html
Another Biowizardry entry on neurotransmitters: http://biowizardry.blogspot.com/2011/08/scared-of-wrong-things-role-of-mao-in.html