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Agent loops generate new reasoning each run. State machines execute the same trace every time. For regulated AI, only one of those is auditable.
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LLM agent loops are non-deterministic by design — re-running the same input produces a different reasoning trace, which means you can describe what the system did but never prove it. Q-MDP state machines give regulated deployments bounded execution depth, persistent state traces written at every transition, and governance confidence gates before terminal output. The architectural comparison, with concrete engineering tradeoffs.