CNBC takes cognitive dissonance to eleven

John Carney said:

... In reality, it does not matter one bit whether the Federal Reserve Bank of New York actually has the German central bank's gold or whether the gold is pure. As long as the Fed says it is there, it is as good as there for all practical purposes to which it might be put. It can be sold, leased out, used as collateral, employed to extinguish liabilities, and counted as bank capital just the same whether it exists or not.

The actual presence of the gold wouldn't make a lick of difference unless, say, Germany's central bank decided it wanted to start using the gold for some practical, non-monetary purpose like making watches.
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PMBug said:

benjamin - your analogy works only if your vault service is also a market where peeps buy, sell, loan and lease the contents of your vault.

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