Interaction Status
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When you grab an object in Super Mario 64, the object isn't actually in your hands, it's invisible and not in its normal state. The object is in a state known as being "in limbo". When you throw or drop the object, it exits limbo and appears at the HOLP.
The term has caused some confusion, because the object is not actually moved to another location. It is just made invisible and (in most cases) doesn't interact with any other objects or Mario.