An event is considered common knowledge among a group of agents when each player knows the information, each player knows that the other one knows it, and so on. Common knowledge is the limit of a potentially infinite chain of reasoning about knowledge. In this scene from Dodgeball, White Goodman (Ben Stiller) is trying to assert that common knowledge exists between himself and Pete LaFleur (Vince Vaughn).
Ben Stiller invites a woman over to his apartment and she’s blown away by the number of pillows on his bed. She calls him out for how much time he’s wasting, but he doesn’t initially see the point. After some aggressive reflection, he realizes how much time he actually spends fluffing pillows on his bed and what he could have been doing instead.