It was my good fortune to meet Milton Friedman in February 1968, while I was at Oppenheimer’s. The stock market was in what looked like the early stages of a bear market, with the S&P 500 down 8% in a couple of months. My partner and good friend, Fred Stein, feared that America was going back to the depression of the 1930s. After all, he reasoned, “All consumers had acquired their needs; everyone had a car.” A very recent University of Chicago grad working in the research department suggested that Fred bring in a relatively unknown economist, Professor Milton Friedman — which he did.

Milton said something like, “You’re completely wrong. Politicians always try to avoid their last big mistake — which was clearly the 1930s. So every time there’s a contraction in the economy, they’ll ‘overstimulate’ the economy, including printing too much money. The result will be a rising roller coaster of inflation, with each high and low being higher than the preceding one.”

Oppenheimer hired Milton that day, despite having six economic consultants at the time. He remained one of them for 16 years— and a good friend thereafter.

What a superb forecast of the devastating inflation of the 1970s. In 1976-77, inflation hovered around 6%. By October 1978, when the yield curve inverted, with short-term interest rates higher than long-term ones because of the strong demand for credit, the consensus forecast was for about the same inflation rate, or lower.

Another of Oppenheimer’s consultants, Alan Greenspan, was more pessimistic, predicting “6 percent to 7 percent, perhaps 8 percent.” But Milton thought Alan was wrong, too. “As inflation rises, people adjust by taking their money out of the bank and spending it, as they perceive its value decreasing. As they keep on spending, the nominal economy will grow somewhat faster, and inflation will rise faster, as well. So I expect the CPI to peak at 10 percent to 12 percent.” It peaked at 14.6% in March 1980.

At that time, Milton said it would decline to around 6% by mid-1982 — way below consensus expectations. It hit 7.9% in June 1982 and 4.9% by September 1982, and then went lower to 3.8% by December 1982 and to a low of 2.4% by mid-1983.

Milton’s predictions in any number of areas are worth recalling. They rested on assumptions that were very different from the decades-old prevailing wisdom that there was a trade-off between inflation and unemployment — a view that still persists within a wide swath of the investment community.

In essence, according to the old orthodoxy, if you had a strong economy, you’d get low unemployment but some combination of rising inflation, inflation exceeding expectations, and rising inflation expectations. This view, labeled the Phillips Curve, after Professor Alban Phillips of Cambridge University, was an offshoot of Keynesianism.

By contrast, Milton and his co-author, Anna J. Schwartz, argued that higher wages don’t cause inflation. “Inflation is always and everywhere a monetary phenomenon,” they contended. As the government increases the rate at which it prints money, the result is too much money chasing too few goods and services. As the Wall Street Journal put it in explaining Milton’s Nobel Prize: “In layman’s terms, the Swedish Academy credited Milton with nothing less than shredding the Keynesian consensus.”

And just as higher wages don’t cause inflation, the whopping oil price increases between 1973 and 1980 didn’t cause the “stagflation” — the stagnant economy with rising inflation — of the 1970s. Rather, the price hikes were the form inflation took.

A generation ago, at a speech to the New York Society of Security Analysts, Milton said something like, “Significant changes in the growth rate of money supply, even small ones, impact the financial markets first — usually fairly coincidentally. Then, they impact changes in the real economy, usually in six to nine months — but in a range of three to 18 months. Even later, usually in about two years in the U.S., they correlate with — or, more likely, cause — changes in the rate of inflation/disinflation/deflation. The leads are long and variable” — though “the more inflation a society has experienced, history shows, the shorter the time lead will be between a change in money supply growth and the subsequent change in inflation.”

Controlling and slowing money growth, Friedman-style, proved a good method for managing the economy. Such monetary policy discipline produced Japan’s golden era and had a similar effect when practiced here at home — by Republican or Democrat. Asked once about why the expansion under President Bill Clinton was so long in the 1990s, I replied, “We’ve had the best monetary policy — that is, the slowest, steadiest, yet positive broad money supply growth — under Greenspan, since the founding of the Fed in 1913.”

It’s almost universally said that Milton flourished in the Chicago school of economics. Certainly, he had some outstanding teachers, including Frank Knight and Jacob Viner. But one of Milton’s first students, James Meigs, told me, “There really wasn’t a Chicago school. It was only Milton’s innate graciousness that allowed such an appellation. It should have been called the Milton Friedman school.”

My confirmation of Jim’s view came when I sat in the audience in 1980 for six of the 10 Q&A tapings for the outstanding and still worthwhile “Free to Choose” TV series. Whenever one of the numerous left-wing panelists said something in opposition to Milton, the audience of perhaps 25 Chicago faculty members would raucously approve.

On my visits to Chicago for these tapings, I would go to the bookstore near the “old library,” where the tapings had occurred. Not only were Milton’s books on the bottom shelf, but also big posters of Lenin and Trotsky were all over the walls. This must be a university-owned bookstore, I thought, as no entrepreneur would downplay a local son like that.

Many years ago, my wife and I spent a weekend at Rose and Milton’s unique octagonal “overthrust” summer home in Ely, Vt. We arrived the day after their son, David, had received his doctorate in physics. On learning that David loved economics, my wife asked Rose, “Why not a Ph.D. in economics?” The sad reply: “Milton’s name is such an anathema in academe, it would be a millstone around David’s neck.”

At the book launching of “Free to Choose” in 1980, Bob Chitester, producer of the fabulous TV series that sparked the book, held up a copy of Milton’s earlier book, “Capitalism and Freedom,” and said, “This was my bible.” Milton, always quick, replied, “That was the old testament; ‘Free to Choose’ is the new testament.”

Then Milton remarked, “I’ve never had a book of mine reviewed by any major paper, not even the [Republican] New York Herald Tribune.” I was sitting directly behind the head of marketing at Harcourt Brace Jovanovich, the publisher, and on hearing these words, she began to slide off her chair, being stopped only by her knees hitting the too close chair in front of her. Clearly, she was panicked about having to push a book her boss dearly wanted — without a review.

I remember hearing that the Harcourt staff almost universally opposed publishing “Free to Choose.” It ended up selling about 500,000 copies in hardcover, and nearly 1 million total. It was the precursor to today’s vast market for conservative books, talk radio, and so on.

I’ve managed Milton and Rose’s personal portfolio for over three decades. The day after Milton received the Presidential Medal of Freedom from Ronald Reagan in 1988, my wife and I visited them at their superb new apartment, with magnificent views of San Francisco. When Milton opened the door, Rose broke out into song and Milton tagged along, à la Rex Harrison, “Welcome to the house that Chuck built. … ” That was a vast, but very gracious, exaggeration, and certainly a highlight of my life.

We also spent a weekend at Rose and Milton’s more recent country retreat, a couple of hours north of San Francisco. It was a charming place overlooking the water, with a magnificent garden, which Rose loved. When we arrived, Milton took my wife up to see their bedroom — where he pointed out the waterbed. On the day Milton died, I reminded Rose of this. She chuckled and said, “Well, it didn’t last very long.”

When Milton was driving us back to San Francisco, he idly commented, “I’ve never been in an accident in which anyone was hurt.” Rose interjected, “What about the two times you rolled over?” To which he replied, “What about the time you did?”

The author Leo Rosten told me a story that has since become part of Milton’s legend. President Nixon, inaugurated in January 1969 after narrowly beating Vice President Humphrey, soon established a commission on the volunteer army. Milton testified before that commission, along with General William Westmoreland. The testimony became a debate between the general and the professor.

The general said, “Professor, everything you say makes so much sense, but I’m not sure I’d like to command an army of mercenaries.” Milton immediately replied, “Would you rather command an army of slaves?” The general indignantly retorted that he didn’t like to see our patriotic draftees labeled slaves, to which the professor responded he didn’t like to see our patriotic volunteers labeled mercenaries. Further, the professor pointed out that he, the general, and most people they both dealt with were “mercenaries.” The commission broke out in laughter, and the draft was abolished that afternoon.

Milton regarded this as the prime achievement of his life. “I have often said I would gladly trade off a degree of economic freedom for more personal freedom. It turns out, empirically, you don’t have to.”

On Sunday, August 15, 1971, President Nixon announced wage and price controls — and closed the gold window. I called Milton that night and asked what was going to happen. He replied, “We’re going to have more inflation.” I asked how — given that we now had the controls. In order to get re-elected in 1972, he explained, Nixon will spend and spend to win voter loyalty, like most incumbents, and then, having created a huge deficit, he will print money to pay for it all. And he’ll print even more imprudently than most presidents, believing that the wage and price controls will mask some of the resulting inflation.

And sure enough, in February 1972, the Treasury announced a $28 billion deficit — very big for that time, even as the real economy grew strongly at 7% that quarter and even faster during the next one. The ensuing double-digit inflation is legendary.

Milton also worked with Ronald Reagan, when he was governor of California, on Proposition One, intended to limit the rate of growth in state spending to the rate of growth in the state’s nominal economy the prior year. The proposition failed, unfortunately, although by a small margin, due to a major ad campaign by state employee and teachers’ unions, bureaucrats, some legislators, and other special interests.

Soon thereafter, Milton initiated an amendment to the U.S. Constitution along the same lines, and he campaigned to get it adopted. Thirty-two states passed such bills; 34 were needed for the amendment to pass.

Milton and George Shultz — who was President Nixon’s labor and Treasury secretary and President Reagan’s secretary of state — had mutual admiration for one another. “George is the most able man in America,” Milton would say of Shultz. At a June 2005 fund-raising dinner for the Milton and Rose D. Friedman Foundation, which advocates for vouchers and charter schools in K-12 education, Mr. Shultz was the second speaker, after Alan Greenspan.

He said something like: “As secretary, I met a number of kings and queens, more than a few dictators, and innumerable heads of state. Often I’m asked, ‘Who was the most impressive, important individual you ever met?’ Clearly, it was Milton Friedman. He was the first academic economist to state strongly what John Q. Public innately knew: that it’s not just the quality of an economist’s thinking that matters; his forecasts also have to be correct.”

George then broke out in song — to a Cole Porter melody — “A fact without a theory is like a boat without a sail, like a kite without a tail. … But there’s one thing worse in this universe, that’s a theory without a fact.” He brought the house down.

Mr. Brunie spent almost four decades at Oppenheimer and has been on the board of the Manhattan Institute almost since its founding, in whose City Journal a longer version of this first appeared.