It doesn’t understand things the way humans do, but saying it doesn’t know anything at all isn’t quite accurate either. This thing was trained on the entire internet and your grandma’s diary. You simply don’t absorb that much data without some kind of learning taking place.

It’s not a knowledge machine, but it does have a sort of “world model” that’s emerged from its training data. It “knows” what happens when you throw a stone through a window or put your hand in boiling water. That kind of knowledge isn’t what it was explicitly designed for - it’s a byproduct of being trained on data that contains a lot of correct information.

It’s not as knowledgeable as the AI companies want you to believe - but it’s also not as dumb as the haters want you to believe either.