As a consequence of the financial crisis in 2008/09, some economists have expressed doubts about the adequacy of theoretical models, especially those that claim to model financial markets and banks. Because of these doubts, some economists are following a new paradigm based on a monetary theory rather than a commodity theory. The main difference between these two views is that in the commodity theory money does not play an essential role, whereas in a money economy every transaction is settled with money. It is therefore essential to clarify whether a theory that includes money comes to other conclusions than a theory that leaves money out. Based on this problem, the second chapter compares the conclusions from the commodity logic of the financial system - modeled by the loanable funds theory - with the monetary logic. Following the review of the conclusions, I describe three theories about banks. The so-called endogenous money creation theory, in which the central banks control the lending of banks through prices, describes our world best. In the third chapter, I use the endogenous money creation theory for modelling the bank credit market. In this model, banks act according to profit maximization, whereby income from lending business is generated and the costs of credit default risk and refinancing costs (including regulatory requirements) are incurred. These are the determinants of the supply of credit, which meets the demand for credit on the credit market. Credit demand is determined by borrowers who borrow from banks for consumption or investment purposes. The interplay between loan supply and demand for credit results in the equilibrium loan interest rate and the equilibrium loan volume that banks grant to non-banks. The supply and demand sides interacting on the credit market are empirically estimated for Germany over the period 1999-2014 based on the theoretical model using a disequilibirum framework, showing that the determinants from the theoretical model are statistically significant. Building on the theoretical banking model, the fourth chapter extends the model to include the bond market. In contrast to the description in the commodity theory, the bank loan market and the bond market are fundamentally different. On the one hand, banks create money according to the endogenous money creation theory. Once the money is in circulation, non-banks can redistribute it by either using it for the purchase of goods or borrowing it for longer periods. Due to the focus on the financial system in this dissertation, the case is considered in which money is lent over the longer term. The motive of the suppliers in the bond market, i.e. those who want to lend money, is similar to that of banks, driven by profit maximization. Suppliers can generate income from interest on bonds. Costs arise from the opportunity costs of holding money as deposits, the credit default of the debtor and price losses due to changes in interest rates. The logic described is based on the idea that banks create money, i.e. they are originators of money, and the money is redistributed on the bond market and thus used several times. The two markets are linked on both the supply and demand sides. On the one hand, banks refinance themselves on the bond market in order to reduce the maturity transformation resulting from lending. In addition, consumers of credit have the option of requesting either bank loans or loans on the bond market. After the description of the theoretical framework of the financial system consisting of the banking and bond market, the fifth chapter follows the application of the model for Quantitative Easing. It should be noted here that Quantitative Easing already influences the behaviour of credit consumers and suppliers when the central bank announces it. The four major central banks (Bank of Japan, Bank of England, Federal Reserve Bank and European Central Bank) have used the unconventional instrument of buying up bonds due to the continuing recession and the already low short-term interest rates. In the theoretical model, the central bank already influences bond market rates through the announcement, resulting in decreasing risk premiums, as the central bank acts as a lender of confidence, decreasing interest expectations (at least in the short term) and decreasing long-term interest rates overall. These three hypotheses are tested using empirical methods for the Euro area.