Generation loss is the drop in quality when data is copied, compressed, or converted. We often think about it in terms of what happens when you copy a copy (for example duping cassette tape or photocoping a piece of paper) but digital data is not immune to this either. We can see generational loss when a file is compressed using a lossy compression or when a video is transcoded.
In this scenario a clever YouTuber uploaded a video, ripped it from the site, and reuploaded it 1000 times. The original video (above) was turned into the nightmarish scene below:
[Lower your sound before listening!]
This happens because YouTube compresses all the content uploaded to the site. Their compression is pretty good, but when repeated over and over again it turns a reasonably good looking (and good sounding) video into something completely unintelligible.
For reference, here is number 250:
This is why you should keep all your original media stored in a secure place and why photographers love RAW files so much–every time data is compressed there are serious and irreversible losses.