I've been reading:
If the UK government wanted to raise £100m pounds, it would issue one mil
lion gilts at the value of £100 each. This is known as the 'nominal value
' or 'par'.
Now to my mind this sounds crazy.
If the Gov wanted to raise £100mill why not just "order the Bank of Engla
nd to print off the money and *give* it to the Gov"? Then the Gov could use
this money without the public being taxed to repay the debt + interest.
I mean the BOE is supposed to be nationalized correct?. So in theory owned
and ran by the Gov/people. And the BOE has the power to create money from n
othing i.e. they control a printing press. So my question is why does the G
ov need to borrow money when it has the power to create as much as needed?
- posted 4 years ago