Smut burying a lede
The theory pursues a loose metaphor with magnetic tape, with the magnetic nanoparticles of Fe3O4 precisely aligned in the brain within cortical minicolumns, like the woven chain-link meshes of ferrite rings that formed computer-core memory in days of yore, recording engrams by way of physical displacement. Figure 1 (below) should make it clear how this works.
Fig. 1. Long-term memory based on the magnetite nanoparticles distributed in neuronal and astroglial membranes (see text): (a) cylinders represent neuronal minicolumns in the neocortex; (b) network that represent 3-D magnetic structures generated by self-organization of multiple astroglial magnetic fields; (c) biomagnetite distribution on neuronal and astroglial cells; (d) long-term memory based on single-domain magnetite distribution in the astroglial network.
If still confused, consult Fig ii instead.
There is an entire warren of rabbit-holes here, waiting to be explored, if we rely on the innate compass of our cerebral magnetite deposits to help us find our way out. For inevitably -- given the ineluctable workings of synchronicity, Narrativium and the Morphogenetic Field -- the idea has been repeatedly re-discovered, and published in Medical Hypotheses, titled with blithe disregard for Betteridge's Law of Headlines:
another school of thought in which cortical nanoparticles are wont to wobble around in such unconstrained, uncoordinated freedom that exposure to the strong changing fields of a MRI scanner will send them all catty-wampus and higgledy-piggledy, to the detriment of the integrity of nearby neurons.*
This possibility is of more than academic importance if you are of similar mind to the Riddled Bioethics Division and Tullymonstrum Affiliations Working Group (every Thursday night at the Old Entomologist). Because if so, by now you will have wondered "Given a multi-Tesla MRI scanner and two ice-block sticks, how can I use them to access the magnetic memories of unwitting passers-by?" Magnetite particles are the smallest, quantised units of clandestine information theft, that is why they are also called SPIONs.
Some would worry that this entire scholium of thought depends on the assumption that our brains do contain magnetite particles, and all this rests upon a single quarter-century-old claim from electrosmog cranks that no-one seems to have replicated except other electrosmog cranks. Even Dottori Gatti & Montanari, Italian impresaria of nanopollutants and nanocontamination, have nothing to say about cerebral magnetite infiltration. The omission is suspicious and invites accusations that their frequent publications and general wolf-crying alarmism is just part of their cover and they are really in cahoots with the conspiracy to conceal the truth. Whereever Cahoots may be. Some say that it is a small village in South-West Ireland.
But fret no more, for we fired up the Riddled Scanning Electron Macroscope and focused it on a bit of Open Mike's brain that he wasn't using at the time, and there were nanoparticles aplenty.
In fact there were magnetic nanoparticles everywhere else we looked too:
The whole tradition can be traced back to 1984 when Lucius Shepard came up with the clever notion of training bacteria to deposit internal crystals of magnetite so as to be magnetotactic, and then acclimatising them to swarm and thrive in the usual bacterial manner but in a specialised environmental niche, i.e. recently-devitalised brains. It turns out that the side-effects of a nervous-system infestation of these bacterial symbionts include sensitivity to magnetic fields, experiencing a Magic Realism sensibility, access to alternative realities, being a reanimated corpse, and eyes that glow green inna dark. Italian translations of Green Eyes get the best cover art, no-one knows why.
But Shepard knew nothing of Class-4 Fictive Confinement Facilities to prevent fictional inventions from escaping into reality... which is how magnetotactic bacteria became a thing.
One of the many inadequate features of consensus reality is its absence of a cinematographic adaptation of Green Eyes. Over in the counterfactual timeline where the movie version does exist, let's just say that Nick Cage and Werner Herzog thoroughly deserved their Oscars.