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There is a subtle thing going on here.
One might expect that the code inside of a FOREVER block would continue forever. However, when a script starts with an "event" block such as WHEN I AM CLICKED, a new event of that kind interrupts the flow. When Alonzo is clicked again, the FOREVER loop is terminated in favor of the new click event. The new click event starts the script at the top, and leads to a fresh FOREVER loop.
Why should a new click interrupt FOREVER? Here, the WAIT is two seconds. If Alonzo were clicked after 1.5 seconds and that event /didn't/ interrupt/terminate the original FOREVER loop, there would be two problems: one minor, one major. The minor problem is that .5 seconds after being clicked and moving, Alonzo would move again since the original two second WAIT would have completed. That would make for an annoying game. Worse, there would be multiple WHEN I AM CLICKED scripts running, each trying to move him every two seconds. And each subsequent click on Alonzo would add to the mess. At some point, it would be almost impossible to click on Alonzo because he would be bouncing around so quickly.
(Take it further: It's not a law of nature that events have to work this way. This behavior is great when it's important that the program react to an event instantly. Sometimes, though, it's more important that once a script starts, it runs all the way to the end. The "thread safe scripts" option in the Snap! options menu changes event handling to ensure that, even if it means not responding to a second event at all.)