The equation $$x^2-x-1=0$$ has two solutions (the golden ratio being one). However, since $$x^2-x-1=0 \quad\implies\quad x^2-1=x$$ we have an equation for $x$ in terms of itself. If we take the left hand side which is equal to $x$ and plug it back into the $x^2$ term we get the quartic $$(x^2-1)^2-1=x$$
This has four solutions (the old solutions with the addition of $0$ and $1$) but these new solutions do not solve the original equation.
Why is there a logical error in using the equation in $x$ recursively in the way shown?
The problem is, I think, clearer if you take a simpler example. $$x^2=1\implies 1\times x^2=1\implies x^2\times x^2=1\implies x^4=1$$
but, of course, there are solutions of $x^4=1$ that are not solutions of $x^2=1$.
The problem, of course, is that some of the implications really are one way only. It is simply not true that $x^2\times x^2=1\implies x^2=1$, all we can say is that $x^2\times x^2=1\implies x^2=\pm 1$. In this way, solutions of the final equation need not be solutions of the original.
As suggested by @IzaakvanDongen in the comments, one can achieve the same sort of example without falling back on complex solutions. Indeed one could write $$x=1\implies 1\times x=1\implies x\times x=1 \implies x^2=1$$ and, of course, $x=-1$ solves the final equation but not the original.