CNBC Trillion Dollar Survey Results - Forget the Experts, Here Are My Predictions

I was just reading the survey results from the CNBC Trillion Dollar Survey (how's that for a name). It's a nationwide "survey of more than 60 strategists, money managers and investment advisers asked their opinions on topics including stocks, commodities, the credit markets, interest rates, the economy and the presidential election."

A summation of the results are:

• 80% see the Dow around 14,000 or higher by the end of the year.
• There was a slight bias towards more weakening of the dollar.
• 79% said the Fed's next move will be a rate cut.
• 72% think Hillary Clinton will be the Democratic nominee for President and 75% think the Democrats will win the White House.
• 73% said the private equity bubble has not peaked.

I think they got some things right but on others, they don't make sense. What this survey is saying is that the dollar will stay low, interest rates will drop, prices will stay low, and corporate profits will continue chugging along. Can't happen.

Here's the equation:

Low Interest rates + High Corporate Profits + Low Dollar = Inflation

There's no way around it. Higher corporate profits eventually trickle down to the consumer and generate the demand for more jobs. It's already happening. This raises salaries. The low dollar makes all of those good imported from China more expensive. More inflation. Low interest rates increase consumption. More inflation.

I think rates are headed up. And I think once they do, you'll see the dollar strengthen. A stronger dollar will decrease the cost of imports. Inflation will remain in check.

I do think the stock market will continue to climb and think 14,000 or higher is likely and probable.

I also disagree with the Presidential prediction. A Republican will win the Presidency but the Democrats will strengthen their grip on Congress. Likely Presidential winner is Fred Thompson. He's likable, known, and acceptable to Northerners and West Coasters.