It has been known for a long time that the part of the brain called the hippocampus has a role in processing recent memories and it was also known that it did not store the information permanently.
Researchers believe that the anterior cingulated assembles signals of old memories from different sites in the brain. The possibility is that in dementia, as in other diseases that affect memory, there is a malfunctioning in this process and that memory becomes fragmented to the point where they make no sense.