主：I
谓：think
宾语（从句）：people only imagine that they see them.
是一个that引导的宾语从句,that省略掉了.
imagine在这儿是及物的,在从句中作谓语,又由that引导一个一个宾语从句.
例子啊……
这句好啦：
i can't imagine the life without you.
及物.