[Idaho_Cowboy]

Quite true. If the CPI is being estimated too low and prices are rising (remember CPI core leaves out fuel), then inflation means the real GDP is even lower than estimated. This means even with a rising nominal GDP, real GDP can be decreasing.

[Brilliant]

The dirty secret though is that the NBER doesn’t go by a fixed definition of recession. The MEDIA will tell you that a recession means that there have been two quarters of negative growth. But the NBER declared a recession in Dec. 2007, even though between Dec. 2007 and August 2008, the real economy grew by 3.5%. When they were asked to explain themselves, they said that the 2 negative quarters rule is not a firm rule. They consider a lot of things.

[Jim from C-Town]

The CPI leaves out BOTh Fuel and food, Because nobody ever eats, drives or ships anything.