Does language shape thought or does thought shape language? I think both are true. Language and thought feedback upon one another.
A fresh, new brain is a raw sea of possibility, with only the most basic initial instinctual wirings. Each new sensation creates a collection of inflowing signals. But if one wishes to access this “memory,” each component of that memory must be activated individually.
Language gives the brain a set of shortcuts to bootstrap higher-order thought. For simplicity’s sake, consider a noun. This noun is a word, a single memory token, but it signifies and is connected to a whole slew of other memories. Activating the noun memory activates all of the memories that compose it. With the act of associating one memory—a word—to represent other collections of memories, one can begin to more easily think about more complex things. Strings of words can be placed together and whole vistas of the brain are stimulated as the imagination goes to work. The individual is freed from having to recall each little stimulus that goes into making every concept in memory and can think more about the object as a whole.
Similarly, in functional computer programming, collections of lower order operations and data manipulations are often stored away as functions, and then accessed through their names in the main body of the code. Whereas in a low-level assembly code it might take four different operations to multiply two numbers together in memory, in a higher-level language like Perl may take only one operation. The programmer is relieved from the burden of caring about the nitty gritty details and can focus more on abstract data manipulations.
Language is a mental shortcut reflecting how we use our brain. It’s nothing more than an interface to our memory. As our needs change, so does our language, much like how programming languages shift to provide both utility and succinctness to the programmer. But as it is our default way to access our memories, the structure of the language affects the way we think. It’s a nice little feedback loop that causes language to dance across the landscape of the mind as time elapses.

When I took a physics of lasers/holography class in Chicago, our teacher gave us an article to read that compared holograms to our brains (I’m sure I still have the article somewhere amongst all my old schoolbooks and notes). Once a hologram has been created with a specially-filmed piece of glass (and developed, etc etc), you can then take the laser beam and point it through any single point in the piece of glass and still project the same image — all of the info is stored and “connected” in the glass. :)
Needless to say, I was very sad when that semester was over. I loved every minute of that class.