While being very capable, AI is missing something required for true intelligence and I struggle to explain exactly what it is I see missing.

It's not really "creativity" because much of that always was derivative in my opinion. And LLMs are (for some definition of the word) fairly creative as far as taking known elements and re-arranging them.

I think what is missing is sort of a world model building capability. As humans we see phenomenon and classify them informally and model "what would it look like if this were the cause of that?" type scenarios. We see qualities in phenomena and realize this applies to other things even though the things may be completely different. We run informal "thought experiments" sort of. This is hard to duplicate because a lot (most?) of it occurs outside of systems of symbols like math and language with fixed rules in my opinion.

Anyway yes, lots of human thinking is statistical and LLMs have that down pretty well but they are not "smart" I have concluded and it might be a very long time, if ever, until they are. That isn't to say they aren't very capable tools which they obviously are.