Since you posted in photoshop elements forum and if the below isn't the problem, you should ask over in
the photoshop general forum where folks are more familar with photoshop cs6
What operating system are you using?
If your on windows i seem to recall some reports of out of date graphics card drivers causing a problem similar to your screenshot.
If your on mac lion or mountain lion it's possible that the cursor size under Apple>System Preferences>Universal Access>Mouse and Trackpad
is set to something other than Normal.
Sorry - I posted in the same forum I had seen another eraser brush question. But I did get my answer. I am on Mountain Lion/Mac, and you were correct. The curser size under "Accessibility" was moved up higher than normal. Thank you!!!!!