When the subject becomes wrapped up in feelings that are dictated by the need for an unobtainable dream. The person can seem incredible irrational and borderline obsessive. The subject may or may not be aware of dream being unattainable. If they are aware, a dilemma most often will occur in regards to pursuing the goal or dropping it. While one answer seems correct to outside people, they will seem equally as hard to the subject.
'Why doesn't Fred just stop talking to Sally. He has to know nothing is there for him. He is simply wasting his time trying hook up with her again. Ok, maybe they had something 7 years ago but come on he just needs to move on'

'He is a classic example of The Gatsby Effect.'
by Derek, R July 11, 2008
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When a person's friends or acquaintances agree to uphold untrue stories about the friend for the sake of helping that friend impress others, especially a romantic interest.
"Rick told me that Marty graduated from Yale and used to work for Disney!"

"Aw, Marty hasn't done any of that. That's just Ricky using the Gatsby Effect to help him date you."
by Fits Gerald June 13, 2013
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