Why does Google use the term "Off the record" when there is a product called Off the record[1] that has been used for end-to-end encryption of IM that pre-dates Google Talk?
Google does many good things, but it would be unreasonable for anyone to expect that they wouldn't store all your chat messages. "Chats that have been taken off the record aren't stored in your Gmail chat history, or in the Gmail chat history of the person you're chatting with. "[2]
[1] https://otr.cypherpunks.ca/ [2] https://support.google.com/talk/answer/29291?hl=en