I’m here talking with Pete Flint, CEO of Trulia, a real estate search engine, and I just told him that Henry Blodgett was wrong and I was right. Pete agrees.

But, Henry is sticking to his guns.

Truth is that Google is the new Yellow Pages. If you aren’t advertising on Google you simply aren’t in business because most searchers who are looking for things like “San Francisco Real Estate” are using Google. That’s not me saying that, it’s Pete. He’s showing me his referer logs, and they definitely show that Google sends more traffic his way than any other search engine.

Anyway, I believe Henry is wrong. I think Google is still gaining strength in the advertising market when compared to Yahoo and Microsoft. With YouTube entering the picture Google is positioned to gain even more.

There’s still lots of businesses out there who don’t realize that Google is the new Yellow Pages. But, as stories like what Pete just told me get around, more businesses will start advertising on Google.

To underscore that. Reuters reports that Google’s growth rate is TWICE that of eBay, Yahoo, or Microsoft’s growth rate. Translation: Google is outrunning any softness that might be in the marketplace (at least in the short term) through its growth. That’ll continue unless the economy takes a turn for the worse (and, according to every number on CNBC lately, shows signs of picking up, not weakening further).

Now, yeah, Yahoo and Microsoft are coming out with advertising systems that act a lot like Google’s does, but it’s going to be hard for those search services to convince new advertisers that the hottest traffic is there.

Pete certainly doesn’t believe that Google is losing any share to Yahoo and Microsoft.

Translation: Henry is wrong. He’ll continue to be wrong. As long as the economy doesn’t get hit hard by something none of us are forseeing.

Oh, and Steve Rubel, you are wrong too.

Disclaimer: I don’t own shares or have any interest in any of the big three search and advertising companies.

UPDATE: Om Malik agrees with me and takes a subtle potshot at those who bought into the Blackfriars’ report, as Rubel did.