Money Quanta

This chapter focuses on the hybrid nature of bank money as it emerges from the Accounting View of Money (AVM) introduced in Chap. 2 . With demand deposits being shown by the AVM to encompass both debt and equity components (in a mix that depends on factors that relate to the issuing banks and the environment where they operate and interact), the idea is explored that they can be treated as objects of Quantum Physics—which typically feature a dual nature—and therefore be subject to quantum analysis. The chapter evaluates the merits of the idea and illustrates the work done using a quantum model to describe how the banks’ power to create money is affected by the interactions taking place among the banks and between the banks and their environments. The chapter reports the main conclusions of numerical simulations run based on the afore-mentioned interactions and discusses how the information extracted through this process can be used for drawing financial stability considerations.