UK Gov debt and the gilt market (why do they need it?)

I've been reading:
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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?
Best Regards
Graeme
Reply to
js64469
ngland to print off the money and*give* it to the Gov"? Then the Gov cou ld use this money without the public being taxed to repay the debt + inte rest.
That's called devaluation and it results in people not trusting the currency. (Although it has also happened recently under the euphemism of "quantitative easing".)
Incidentally, most people on pension annuities rely on the interest and stability of gilts. They would be particularly badly hit by the inflation caused by devaluation.
We also get into money supply figures here. Governments don't actually hand over paper money when they buy things. A description of how this is
done for QE is in
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014/qb14q102.pdf page 24, paragraph 3.
Note that the aim of quantitative easing is not to allow increased government spending, but to encourage spending in the private sector.
Reply to
David Woolley
Because the UK's currency (total) is worth $1trn. Let's say that means £1 = $1.50
If we print 10% more currency, our total is still $1trn. But that means that £1 now = $1.35
Let's say we print 50% more. Our total is still $1trn. £1 now = $1.
If every other currency remains static compared to the $, everything we import is now a LOT more expensive, in £, so we're back where we were, globally speaking. Except there's less confidence in the economy of this country.
Reply to
Adrian

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