Are you asking about Premiere Elements or Photoshop Elements?
This is the Premiere Elements forum.
If your program is Photoshop Elements 8, then you have posted in the wrong forum. Somehow you thread got posted in the Premiere Elements Forum (video editing). Please re-post your thread in the Adobe Photoshop Elements Forum to take advantage of the Photoshop Elements expertise there.
Two things to think about as you head in that direction
Assuming Windows computer for your Photoshop Elements 8.0
a. Have you reset tools?
b. Have you recently changed in Text size - Display setting to 150 instead of using it as 100%?
c. Have you done the deleting of the Editor's settings file - holding down Ctrl+Alt+Shift routine?
Apologies, sent to wrong forum, thanks for the tips