While LLMs are “merely” token predictors, it seems that perhaps the “knowing” is actually imbedded in the large corpus of memetic data.
In the same way that an infinitely detailed “choose your own adventure” book shows that data and computation are interchangeable by degree, (calculation vs lookup), my conjecture is that the often surprising effectiveness of LLMs, as well as there very human like flaws, are the result of this kind of computation-in-the-data scenario.
I posit that the overt connections in textual human knowledge also carry the implied knowledge that provides the unwritten context necessary to understand, if enough vector relationships can be teased out of a sufficiently large corpus of data.
It could easily be that our own “understanding” is also derived from the vast n-dimensional matrix that represents all human cultural knowledge.