*Spinning the GDP

The first-quarter gross domestic product is due out Wednesday, the first chance we get to see how the overall economy has fared this year. By all the recession talk we've been hearing, you would assume that growth contracted during the quarter. (A common definition of recession is two consecutive quarters of negative GDP.) But there is a decent chance that the economy actually grew in the January-March period – not much, mind you, but growth nonetheless. Huh? What happened to the recession? Well, it's still hovering around, but because there's no way to measure the total economy on anything close to a real-time basis the experts can’t tell whether a recession has arrived, is about to arrive or might not arrive at all. Even Wednesday's GDP number will be subject to revisions over the next several weeks. For economists, being right about a recession forecast can be a career-enhancer or deflator. So with the possibility of positive first-quarter growth, we're already seeing some tap dancing. Dave Rosenberg, chief economist at Merrill Lynch & Co., says that GDP growth doesn't count if it doesn't keep pace with average population growth. Oh. From the WSJ:

By the third quarter, the economy should get a boost from the tax-rebate checks, even if Americans spend only 30% of their checks, as J.P. Morgan Chase & Co. economists estimate. But things could get dicier early next year. Global Insight sees a 30% chance the economy could hit the second half of a "double-dip" recession then, and that raises questions about whether the Fed should pause in lowering interest rates after its expected rate cut this coming week. "They need to bear in mind that their actions now won't have an impact until early 2009," Global Insight's Brian Bethune said. With risks lingering through early next year, the U.S. could face "a much longer recession" than most people are expecting, he said.

It could be many months before we get the final word from the National Bureau of Economic Research, the nonprofit group that is the official arbiter of recessions. And just to complicate things even more, the bureau doesn't abide by the two straight negative quarters definition. It defines a recession as a significant decline across the economy, which can mean most anything. The last recession, in 2001, had two quarters of negative GDP, but they weren't consecutive. Clear enough?

*Warren Buffett says that we're in a recession, no matter what the numbers show. "I think it's defined by the man in the street differently than whether there have been two quarters of reported GDP growth," he tells CNBC. "We are in a recession unless you want to stick strictly to the technical definition, which I don't think has much meaning to the fellow who's lost his job..."