Insisted recall. The government would just cancel it, the Gilts would never go back out into the market. The money never be cancelled and we don’t therefore have a large national debt.
My enquiries of the Bank of England suggest that this year £20.1 billion of the quantitative easing funding owned by the Bank of England will be redeemed and require reinvestment. This is in two broadly equal tranches, one this month and another in September.
Now just suppose that instead of this sum being used to buy gilts already in issue in the market place it was instead used to buy the loans issued by a new National Investment Bank tasked with creating national infrastructure. Under Maastricht rules we know these would need in the first instance to be offered to the markets, but just suppose that £20.1 billion was at the very least made available to underwrite these issues in case the market did not have the appetite for them. What would happen then?
Now he’s actually insisting that as the QE gilts mature they must indeed be repaid and the cash spent on his pet project.
There’s nothing like consistency is there, and this is nothing like consistency.