All this world is a state; in truth, it is consciousness alone

The Sthiti Prakaraṇa opens where the Mumukṣu left off: the world is not what it appears to be. Sthiti — state, standing, the way things are — is the subject of this entire section. Not “the way things really are” but “the way things appear to stand.” Vasiṣṭha’s argument is that what stands is consciousness itself, appearing as the multiplicity of forms. The forms are real as appearances; consciousness is real as substance. The confusion arises when we mistake the appearance for the substance.