George hammers the basic truth

Fedophilia:

Nor does the way monetary economics is taught help. In other subjects, the welfare theorems are taken seriously. In classes on international trade, for example, time is always spent, early on, on the implications of free trade: never mind that the world has never witnessed perfectly free trade, and probably never will; it’s understood that the consequences of tariffs and other sorts of state interference can only be properly assessed by comparing them to the free trade alternative, and no one who hasn’t studied that alternative can expect to have his or her pronouncements about the virtues of protectionism taken seriously.
In classes in monetary economics, on the other hand, the presence of a central bank—a monetary central planner, that is—is assumed from the get-go, and no serious attention is given to the implications of “free trade in money and banking." Consequently, when most monetary economists talk about the virtues of this or that central bank, they’re mostly talking through their hats, because they haven’t a clue concerning what other institutions might be present, and what they might be up to if the central bank wasn’t there.

I can put this in sandbox terms. 

If one has not understood a double entry accounting system, then one never understands the triple entry accounting needed for central banks.  Central bank traders need to account for the monopsony fee. One cannot make a double entry model when central banks carry, by definition, a variable monopsony fee. And this comes straight from the theory of incomplete markets.

A variation of Georges point, the real world is modeled as a deviation from the welfare theorems. The real growth model is built as a deviation from the Solow growth model.

But, in the end, truth prevails because the physicists have proved the double entry accounting system with their profitless, libertarian theory of gravity as an emergent property.  Gravity is error correction, we have motion in 3-D because we maintain a surplus for the market maker to fill a constrained 2-D channel. We are back to the theory of the market maker.

Is central banking doable? Well yes, but done correctly we remove the arbitrage moments by which traders gain government insurance.  And, further, central banking is built into the Constitution, and explaining that problem to Congress is one steep issue. We may not get their.  Our fintech firms understand the theory and they are not waiting for central banks to catch up.