NEW YORK ( TheStreet) -- Jim Cramer fills his blog on RealMoney every day with his up-to-the-minute reactions to what's happening in the market and his legendary ahead-of-the-crowd ideas. This week he blogged on:
  • rising compensation costs and why they shouldn't be a concern;
  • more evidence of housing's turn; and
  • unwarranted negativity surrounding earnings.

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Rising Compensation Costs Not a Bad Thing
Posted at 6:39 a.m. EST, Friday, Jan. 21

It's the costs, the compensation costs. That's what peeved so many analysts Thursday, whether it be the cost of opening new mines at Freeport ( FCX) or hiring new workers at Union Pacific ( UNP) or the compensation costs at the banks that are growing.

To which I say, give me a break. When a company like Freeport sees opportunities in opening long since closed mines or scaled back projects in America to meet voracious copper demand in China, it's going to do so. And if Freeport thinks that construction is going to pick up in this country, it better open those mines. If Union Pacific is going to let others take business because it won't bring back the 9,000 people it laid off, it's not as great a company as I thought. And if the banks that survived want to stay in the game and take share they should be paying good people to stay and getting good people in to do the work.

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But somehow the analysts seem to want it both ways, more business, much more business, without any new costs. That's unrealistic. And you don't own stocks just because costs keep getting cut -- you own stocks because businesses are growing and they need to expand because they have such demand.

We got fat and happy with the idea that companies can keep making numbers through productivity. But we aren't at that stage any more. When Chuck Bunch, the great CEO at PPG ( PPG), has to bring in more people to meet the demand he's doing what's right for the business, not what's right for the analysts. And if he didn't have any new business at this stage of the economic expansion you don't want to own the stock anyway. Ford's ( F) bringing in 7,000 not-as-highly-compensated employees because it, too, wants to meet demand.

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