From your description I can only guess that the chain might have been too slack. The rear wheel has to be pulled back so that the chain has only about 1/8" of vertical play at the center of the span. Another way is to rotate the pedals while watching the chain to find the tightest spot and at that point pulling all but the last vestige of slack out.
It's important that you leave some slack because the sprockets aren't perfectly concentric and you have to provide for changes in tension.
If the chain was already tight it's possible that you were sold a bike with a stripped rear hub, and when you nailed it the sprocket spun. Given that you don't know the pedigree, I'd remove the lockring and sprocket to make sure.
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PS. I hadn't watched the video before posting, and now add that the chain tension seems OK, though the eccentricity is more than I like to see. The possibility of a stripped hub is now increased in likelihood.
BTW- if you loosen all the chainring bolts, and bring the crank to the tightest chain position, you might be able to tap the chainring back a bit then to reduce the eccentricity. Do this a bit trial and error to find the position of minimum "bounce" then tighten the chainring bolts to keep it there.
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FB
Chain-L site
An ounce of diagnosis is worth a pound of cure.
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Last edited by FBinNY; 07-11-10 at 09:55 PM.