The Role a user occupies determines their access. Look in Admin > Security > Access Control Profile
You'll see that in the Manager Role the manager has "inherit" access which means for those Users he manages he can see their records.
If you create a new user and give that User a Manager Role, by default the Manager Role inherits their record access from the other Users that he manages.
If that new user is not a manager of anyone, you need to define the access appropriate: Read and Write All or just their Own (Own meaning that that User is on the Sales Team of those records). If a user is on the Sales Team that user is said to "Own" the record.
That particular user has also been setup with multiple Roles so in Preferences that user can change their Role to Administrator and be on a peer level with you as an Administrator. If the user has multiple roles they can switch between roles - this was done to help the Administrator see what different Role setups would mean for the other users in that Role.