Made in China (Not)

There are myths, rumors, and stories that get handed around so much they become accepted wisdom -- when in fact they’re not true.

Like drinking eight glasses of water a day. It won’t hurt you, and it’s probably better to drink more water than less. But the eight-glasses-a-day recommendation isn’t based on any solid research. It started way back in 1945, when the Food and Nutrition Board of the National Research Council suggested people should drink “1 milliliter of water for each calorie of food.” Based on calorie consumption back then (not the obesifying eating habits of today), that comes out to eight glasses a day.

Here’s another piece of common knowledge that has no foundation in reality: All the U.S. manufacturing jobs went to China because that’s where most of the stuff we buy nowadays gets made. That's inaccurate -- wildly so. Recently the Federal Reserve Bank of San Francisco released a study showing that just 2.7 percent of U.S. personal-consumption spending goes to products and services from China.

And less than half of that money actually ends up in China. The rest goes to American companies that do the shipping, marketing, and whatever else is required to sell goods and services. “If a pair of sneakers made in China costs $70 in the United States, not all of that retail price goes to the Chinese manufacturer,” reads the report. “In fact, the bulk of the retail price pays for transportation of the sneakers in the United States, rent for the store where they are sold, profits for shareholders of the U.S. retailer and the cost of marketing the sneakers.”

Fact number two: Just 11.5 percent of American consumer spending goes towards all goods and services produced overseas.

Another myth busted. While we’re in a debunking mood, we’ll pass along this factoid to our coffee-guzzling colleagues in the small-business community: Caffeine does not make you pee. In 2000, a University of Nebraska researcher conducted a study that showed caffeinated beverages don’t dehydrate you more than any other beverages. (So you’ll just have to find another reason to kill time in the bathroom.)

Washington: Living the dream. This could explain a lot, like why politicians think it’s OK to fiddle around on Capitol Hill while the rest of us sweat. A recent Gallup poll found that Washington, D.C., leads the U.S. in economic confidence. In fact (we’re saying that a lot this week), D.C. checks in with the only positive Economic Confidence Index score in the entire nation. More amazing, its confidence score for first half 2011 was 12 points higher than its confidence score for the same period last year.

“Many may argue that the relative economic optimism of those in the nation’s capital and the states around it reflects their insulation from what is happening in the rest of the economy,” Gallup noted suggestively.

Rounding out the 10 most confident places are farm, energy, and government states: North Dakota, Nebraska, South Dakota, Maryland, Massachusetts, Utah, Iowa, Minnesota and Virginia.

Who’s least confident? West Virginia, Maine, Idaho, Louisiana, Mississippi, Nevada, Kentucky, Delaware, Ohio, Florida and Rhode Island.

Gallup said national economic confidence “plunged” in July and August, and it added that “overall, this decline in confidence does not bode well for economic growth in the second half. Although the Fed's recent decision to keep interest rates low over the next two years may benefit Wall Street, it is not clear that this will help create a much-needed turnaround in confidence on Main Street.”

We’ve got a Gallup poll for Wall Street. And we know right where to put it.