Joe McGrath has never held a political office. Virtually no one in the Montgomery County electorate has heard his name. His active campaign for county executive is just two weeks old, and he must squeeze meetings and appointments into late evenings and weekends until he finishes his two-week duty with the U.S. Army reserves.

By conventional political barometers, Joseph C. McGrath would not be considered a serious candidate. But to hear him talk, with a confidence that borders almost on arrogance, one comes away with the impression that either McGrath is living in a political fantasy world or he knows something no one else does.

For instance, McGrath openly promises that he will have $50,000 in the bank by the end of June. He also openly promises to raise $200,000 in his bid to unseat incumbent Democrat Charles W. Gilchrist. In a year when money is tight, when even incumbents are having trouble finding funds, such pledges sound foolhardy at best--unless McGrath knows something no one else does.

He quit his job as vice president of American Security Bank to campaign full time. One Saturday, he went from a meeting with a well-connected county Republican to an appointment at a public relations firm, then to a meeting with a black who may become a County Council candidate, then to a meeting with a group of Jewish liberals in the county. Politicians view him skeptically as a newcomer with ambition and no track record. But privately, many are asking what makes Joe run--or rather, what makes Joe run as seriously as he does?

"McGrath to date has run as good a campaign as any candidate I've seen," said county GOP chairman Paul Clark. "He's done everything right."

What McGrath knows is that Del. Luiz R. Simmons, the moderate-to-liberal, one-term state legislator running for county executive, is far from the consensus choice of the county GOP. Simmons puts himself in that category of liberal Republicans who have fared well at the polls in this overwhelmingly Democratic state--along with Sen. Charles McC. Mathias and former Rep. Gilbert Gude.

But the county's conservative faction has been grumbling lately that Simmons may be too liberal, too eager, too willing to avoid contacting party regulars during his term in Annapolis, and now just a little too strident in his attempts to let Democratic voters know that he disagrees with Ronald Reagan on the issue of laying off federal workers.

Said one party insider, "Simmons forgot that he has to win the primary first." Another Republican, speaking off the record, compared Simmons to Prince George's executive Larry Hogan, who in the Watergate year of 1974 tried to run for reelection to Congress by campaigning against Richard Nixon. Hogan lost the primary to a more traditional Republican.

"It's a typical mistake that candidates make," said Montgomery Republican Donald Devine, Reagan's director of the Office of Personnel Management and the man in charge of carrying out the reductions-in-force. "You can't run away from your president. You have to get through your primary first."

Then along comes Joe McGrath. He has been a precinct worker in Silver Spring (he lives in the Falkland Apartments). He co-chaired the annual Lincoln Day Dinner and last year's annual Neighbor-to-Neighbor fund drive. His background as a banker in charge of commercial lending is palatable to the conservative business community.

And, on the subject of Ronald Reagan and supply-side economics, McGrath has said, "We've had close to 20 years of largesse that's created inflation. To get back to an economy that has a low level of inflation, a low interest rate, and real growth costs something." Then, sounding much like Reagan himself, he added, "There is no free lunch."

What McGrath knows is that Republican primary voters are really few in number and that many of them are more conservative than the average Montgomery County voter. What he didn't know, however, was that conservative Jack Hewitt, who became a Republican only this month, would also jump into the race in a play for that same conservative, pro-business and anti-Simmons constituency.

Only when the Hewitt factor is mentioned does McGrath seem, momentarily, to lose his poised, confident, answer-for-everything air. But it quickly comes back and he says, "I'm running against Charlie Gilchrist."