There seems to be some question about what Google is measuring in Tools, Site Performance. It is certainly not the time Googlebot takes to load you web pages basic content. It is definitely the time it takes for the "onload" event to occur.
I say this because since the Oct. 13th Panda tweak (75% traffic loss) I felt I had lots of time and incentive to improve one of my site's performance, solely from Google WebMaster - tools - site performance - perspective.
After all this work what the visitor sees, perfomance wise, has changed very little, BUT, google's site performance indicator has gone
from 3 to 5 seconds per page to 0.2 to 0.5 seconds. This is on some pretty cheap hosting also. (With GZIP compression)
This was achieved by moving almost all loading and rendering to after the onload event. Please do not think because it appears your entire page content has rendered that the "onload" event has fired! Many things delay the "onload" event. Virtually all ads, borders, navigation, etc on this site now load after the "onload" event. Google's measure is a bit of a farce, but there is one advantage to visitors to the site, they can navigate through the site at a lightning pace (should they want too!).
Below is a link to a thread with an excellent tool to see when your "onload" event occurs.
Web Page Performance tool [webmasterworld.com]
This tool, and perhaps standards, refers to this onload time as the "Document Complete" event. Look for the vertical blue line when analyzing your pages.
For my modified site this event occurs very early and then all sorts of content is loaded by javascript after this event. (I am aware of the downsides to this.)
Even this site's background image is loaded after this event. The page first might render, if the browser is fast enough, with a color that closely matches the background image, and then after the onload event the image itself is loaded and rendered using javascript and styles.
To date this appears to have done little for this site's rankings. The Oct 13th Panda tweak still dominates. But I've eliminated yet another possible factor, advertising overhead and overall load time as measured by Google.