Many SLT systems quietly assume that brief chunks of signing map directly to spoken-language words. That assumption breaks down because signers often create meaning on the fly using context, space, and movement. We revisit SLT and argue that it is mainly a cross-modal reasoning task, not just a straightforward video-to-text conversion. We thus introduce a reasoning-driven SLT framework that uses an ordered sequence of latent thoughts as an explicit middle layer between the video and the generated text. These latent thoughts gradually extract and organize meaning over time. On top of this, we use a plan-then-ground decoding method: the model first decides what it wants to say, and then looks back at the video to find the evidence. This separation improves coherence and faithfulness. We also built and released a new large-scale gloss-free SLT dataset with stronger context dependencies and more realistic meanings. Experiments across several benchmarks show consistent gains over existing gloss-free methods. Our code and data are available at https://github.com/fletcherjiang/SignThought.

Contextual causal reasoning is a critical yet challenging capability for Large Language Models (LLMs). Existing benchmarks, however, often evaluate this skill in fragmented settings, failing to ensure context consistency or cover the full causal hierarchy. To address this, we pioneer METER to systematically benchmark LLMs across all three levels of the causal ladder under a unified context setting. Our extensive evaluation of various LLMs reveals a significant decline in proficiency as tasks ascend the causal hierarchy. To diagnose this degradation, we conduct a deep mechanistic analysis via both error pattern identification and internal information flow tracing. Our analysis reveals two primary failure modes: (1) LLMs are susceptible to distraction by causally irrelevant but factually correct information at lower level of causality; and (2) as tasks ascend the causal hierarchy, faithfulness to the provided context degrades, leading to a reduced performance. We belive our work advances our understanding of the mechanisms behind LLM contextual causal reasoning and establishes a critical foundation for future research. Our code and dataset are available at https://github.com/SCUNLP/METER.