@texbucki - the IRS already gave you the tax break on the stock losses within the IRA....you never paid tax on that money going into the IRA so the IRS doesn't give you a tax break on losses that occured within the IRA - as it would constitute a 2nd tax break on the same dollar.
simply, for a traditional IRA (assuming pre-tax contributions), the money is not taxed as ordinary income on the way in to the account; but it is taxed as ordinary income on the way out. There are no tax consenquenses on teh money while it is in the IRS (you can't take a deduction on your losses nor do you pay capital gains tax on your realized gains) it is that simple.
