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Force Majeure Markets~ How long can this Alice in Wonderland Market ignore the numbers?
The economic policies of the Reagan Economic team were inspired by classical economists and Jude Wanniski during the 1980 Campaign.
They were augmented by Martin Feldstein, and implemented by Deputy Treasury Secretary Paul Craig Roberts and Federal Reserve Chairman Paul Volcker.
At that time the Philips Curve stated there was a tradeoff between inflation and unemployment.
Reagan considered the Philips Curve bad neoKeynesian policy mix. He called for supply-side economics with tax cuts and steady money supply to create more product at lower cost.
Reagan was right despite mass media pronouncing him a Dumbledore who slept through the Presidency. Reagan cut out the media middlemen and went straight to the public with his simple Oval Office chats and charts. Not bad for a man who could not hear or see well.
http://homepage.newschool.edu/het//profiles/phillips.htm
Reagan’s first Treasury Secretary and later Chief of Staff, Don Regan, former Chairman of Merrill Lynch, said on page 142 of his 1988 book that Reagan never showed an understanding of economics.
http://en.wikipedia.org/wiki/Reaganomics
Subsequent Fed Chair Alan Greenspan, who missed the market crashes in 2000 and 2008, predicted runaway inflation under Reagan deficit policies. That never happened.
George HW Bush, a three-year Yale Phi Beta Kappa in Economics, called Laffer and Reagan supply-side Voodoo Economics before becoming Reagan’s VP.
Reagan outspent the Soviets on military hardware. The cold war with the Soviets ended. The United States enjoyed one of its longest peacetime economic expansions in history.
http://vdare.com/roberts/reagan.htm
