The context is state. This is especially noticable for thinking models, which can emit tens of thousands of CoT tokens solving a problem. I'm guessing you're arguing that since LLMs "experience time discretely" (from every pass exactly one token is sampled, which gets appended to the current context), they can't have experiences. I don't think this argument holds - for example, it would mean a simulated human brain may or may not have experiences depending on technical details of how you simulate them, even though those ways produce exactly the same simulation.