There is an alternate universe, just like our own, with one exception. For historical reasons*, central banks do not own government bonds. They own land instead. They buy and sell land, and adjust their target price of land several times a year, to try to keep CPI inflation at the 2% target. If a central bank fears that inflation will fall below the 2% target, it buys land and raises the target price of land. If a central bank fears that inflation will rise above the 2% target, it sells land and lowers the target price of land. Sensible economists build macroeconomic models where central banks set the price of land, because that is what central banks really do.
The simplest macroeconomic models in that alternate universe are long run models. They say that if the central bank doubles the target price of land, that will eventually cause the general price level to double too, other things equal. This is known as "land price neutrality". And they say that if the central bank makes the target price of land grow at 10% per year, that will eventually cause the general inflation rate to increase to 10% per year too, other things equal. This is known as "land price superneutrality". More sophisticated macroeconomic models incorporate sticky prices and expectations, and try to say something more precise than "eventually". Those more sophisticated DSGE models also introduce other shocks, and try to say something more precise about what central banks need to do when other things are not equal.
Macroeconomists in that alternate universe argue about the monetary policy transmission mechanism. The mainstream view is all assets are substitutes, to a greater or lesser extent. If a central bank raises land prices, that raises asset prices across the economy, which makes investment in newly-produced capital goods relatively more profitable, which increases aggregate demand. An increase in land prices, and other asset prices, also increases consumption demand, via wealth effects and substitution effects. Some economists stress the role of expectations, because if the central bank raises land prices people know that all prices must rise in the new equilibrium. A few Monetarists try to insist that what is important is that the central bank is issuing more money, and the rise in the price of land is just a symptom, rather than a cause. But nobody takes them very seriously, because everybody knows that real world central banks set the price of land, and the quantity of money is endogenous.
There is a bunch of monetary cranks in that alternate universe, who call themselves "New Keynesians". The New Keynesians want central banks to hold short-term Treasury bills instead of land, and target a short-term nominal interest rate instead of land prices, adjusting that nominal interest rate target several times a year to keep CPI inflation at the 2% target. They build macroeconomic models to show how central banks could target inflation by lowering nominal interest rates when inflation looks like it will fall below target, and raising nominal interest rates when inflation looks like it will rise above target.
Orthodox central bankers don't pay much attention to the New Keynesians. They are amusing thinkers, who come up with strange but interesting thought-experiments, but that is not how monetary policy works in the real world. Because real world central banks buy and sell land, not Treasury bills. And real world central banks set land prices, not nominal interest rates.
One day, the nominal interest rate on short-term Treasury bills falls to 0%. The orthodox central bankers gently tease the New Keynesians: "So, it seems your model has hit some sort of Zero Lower Bound! You can't buy buy short-term Treasury bills to lower their nominal interest rates below 0%, because people would just hold currency instead!"
This is the end of the road for the New Keynesians. They try to save their model by introducing something they call "forward guidance" on nominal interest rates, though nobody else can figure out how it is supposed to work.
But orthodox central banking carries on just as before. The price of land is finite, so when central banks want to loosen monetary policy they simply raise the target price of land, just like before. Orthodox central bankers simply cannot understand the concept of a "liquidity trap". So what if currency and short-term Treasury bills are perfect substitutes in some circumstances? It has no implications for monetary policy. The price of land is what really matters.
[*I have tried, and failed, to cook up some vaguely plausible alternate history of how central banks came to own land rather than government bonds. John Law was clearly involved somehow.]