This could be a problem with Premiere Elements and Pro both, but in this particular case it is Premiere Pro.
HDV project 1080i - don't think that the type of project matters but it may.
The clips in the media panel are all in order 1, 2, 3, .... 101, 102, 103, ....
When dragged and dropped on the timeline they look like this; 1,2,100, 3,4,101, 5,102, 6,....
Also, other sequences in the same project, where the clips were all in order, the clips are now all jumbled up like above.\
This is just too weird and I have never seen this happen before. This is also probably the largest project I have ever worked on, 8 hours of m2t HDV.
If anyone has seen or heard of this before please let me know, maybe just too much for one project and it will be easy enough to create a few small ones so that is what I am going to do for now.