An agent is a loop around a language model, not a magic component. Once you can name each part of that loop you can debug it, test it and put limits on it like any other service.
The core loop
The runtime assembles a prompt from instructions, state and available tools, calls the model, parses the response, executes any requested tool call, appends the result and repeats until a stop condition is met.
Stop conditions matter most
Maximum iterations, maximum tokens, wall-clock timeout, repeated identical calls and an explicit finish signal from the model. Without all of these an agent can loop until your budget or patience runs out.
Where the failures live
Most production incidents come from parsing, tool errors and unbounded loops rather than from model quality. Instrument each of those points before you tune any prompt.
Action step
Write the pseudocode for your agent loop from prompt assembly to stop condition, marking every place an exception can occur and what your code currently does when it does.
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