Classical economics, which had nearly vanished after the 1930s, was revived and much improved in the late 1960s and 1970s by thinkers such as Robert Mundell (1999 Nobel Laureate), Arthur Laffer and others. However, the classical tradition of economic thinking goes far back into time. Contemporary classical economics builds upon the great successes of Adam Smith, David Ricardo, Jean-Baptiste Say, John Stuart Mill and Ludwig Von Mises. The classical perspective has probably been around, in one form or another, since humans began to form societies sophisticated enough to be said to have an “economy.” The economic writings of Confucius and Lao-Tzu are fundamentally classical in their viewpoint (both recommend low taxes, a market economy, and minimal government intervention).
Statism has been in decline ever since the worldwide “Supply-Side Revolution” of the 1980s reaffirmed the superior potential of market capitalism. However, contemporary economic thinking everywhere remains mired in the fallacies that were resurrected in response to the failures of the 1930s. Even “neo-liberal” or “conservative” schools of economic thinking, such as the Monetarists or even today’s so-called Austrians (we call them the “Rothbardians”) have not really rediscovered the great truths of the classical economists, much less grasped the more recent – and vastly important – innovations in the classical school. Alas, many, maybe most, of those who call themselves “supply-siders” have drifted into monetarist quantity theory, the fallacies of which have been exposed by classical economists literally for centuries. So perhaps it would even be best not to say that we are “supply-siders,” whatever that may mean to most people today, but simply to reaffirm our commitment to the most sophisticated, advanced, and fundamentally correct economics of any form, which happens to be solidly within the classical tradition.
What does all this mean? We believe that we provide the most insightful economic commentary available in the world today. This does not guarantee a succession of perfect market calls, but it does, we believe, give investors an advantage that can be significant.
Classical economics is almost completely neglected by universities today, where professors continue to parrot endless variations on flawed monetarist and Keynesian themes. Those with further interest will be richly rewarded by perusing the great works of classical economics, including Adam Smith’s The Wealth of Nations, David Ricardo’s Principles of Political Economy and Taxation, Jean-Baptiste Say’s Treatise on Political Economy, John Stuart Mill’s Principles of Political Economy, and Ludwig Von Mises’ Theory of Money and Credit and Human Action.