Green’s Dictionary of Slang

(US) to talk unrestrainedly, in a speculative manner; thus blue-skyer, blue-sky artist, one who speculates freely, with little basis in fact.

1957		M. Shulman Rally Round the Flag, Boys! (1959) 151: You guys [...] blue-sky it.
1979		G. Wolff Duke of Deception (1990) 242: ‘He was a blue-sky artist,’ Mother says of Father.
1986		C. Stroud Close Pursuit (1988) 212: Are we blue-skying it here? Are we into a covert op situation-wise?
1992		K. Lette Llama Parlour 39: People were always trying to ‘blue-sky’ me, or take me ‘to the max’ or ‘run it past’ someone or other.