This is a brillaint way to simulate reasoning, but its likely not how we reason ... simply how we store reasoning in writing.
Its useful if you know how to use it, its dangerous if you think its more than that.
But tl;dr it can (since its uncompressing our lingusticially stored reasoning from books) arrive at reasoning a DIFFERENT way than our brains did... and this isn't right or wrong.
Where it diverges is when it must move beyond the text or even the synthetic possible text of all vector spaces combined (aka novel territory) and it can't conjecture or test those outcomes well. But to be fair, neither can MOST humans.