Are We In a Recession Right Now? – Real (Or Not So Real) GDP Grew at 1.3% in 1st Quarter

I did want to follow up on my post about preliminary 1st quarter 2007 Real GDP which the Commerce Department reported as 1.3% before the open last Friday.  To answer my question, “Does The Economy Matter?”, the answer, at least on Friday, was: NO – as the Dow rallied 15 points in the face of that ugly number. 

Scroll down to Table 1 (page 5 of 13) and you can get the nuts of the report:

Consumption Expenditures: +3.8% (from the 4th quarter)

Private Investment: -6.5%

     – Non Residential Investment: +2.0%

     – Residential Investment (mainly housing): -17.0%

Essentially what this says is that housing is really bad, business investment is tepid and consumer spending is strong.

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I wrote “Or Not So Real” because I’m a believer, along with others, that government inflation numbers substantially understate actual inflation.  I mean: how is it that money supply growth always exceeds inflation growth when money supply growth IS inflation? 

It makes me wonder: Are we in a recession right now?