I think we can all agree that things will go better if all currently working monetary economists stop teaching their models to undergraduates and instead adopt my modelling approach:
A bank is a box, with “BANK” written on it
A central bank is a box with a pitched roof and lines on the front representing the fascia of the Bank of England
The household sector is a stick man
The industrial sector is a box with a sawtooth roof
Long term savings are a stick figure with a top hat
With these basic concepts, plus sufficient scribbled arrows, more or less any problem in monetary economics can be solved, up to the level of accuracy of any other model. You can even do international monetary economics by drawing circles round one monetary system and scribbling somewhat larger arrows in and out of the circle.
Update! Lots and lots of consensus building on this one and I may yet win that Nobel Prize after all. Two big points of controversy – 1) does the box representing a bank really need “BANK” written on it? and 2) shouldn’t the industrial sector also have a chimney? I think that’s enough of a debate to keep the journal publishers in business.
On the critical question of how to portray the industrial sector, I submit the below historical document, which I borrowed from Lizabeth Cohen’s Consumers’ Republic.
Clearly the chimney is canonical. I suppose whether there’s smoke coming out of it depends on whether you’re depicting the boom or bust part of the cycle.
Oh, and here’s DeLong’s actual illustration.