The error is that the "..." denotes an infinite sum, and such a thing does not exist in the algebraic sense. The usual way to make sense of adding infinitely many numbers is to use the notion of an infinite series: We define the sum of an infinite series to be the limit of the partial sums. (So the notion of convergence from analysis is involved in addition to algebra.)

Not all algebraic rules generalize to infinite series in the way that one might hope. When they fail, it is because something fails to converge. In this case, what fails to converge is the series that should appear between the two lines in the middle of the "proof": Indeed, this series fails to converge because the sequence of partial sums oscillates between and and does not converge to any value.