Misconceptions

Grow posted this article on misconceptions by U.S. citizens in the Boiler Room where political debate runs wild. Since I saw that I have been guilty of saying these misconceptions, I thought I would post them here.

"3 misconceptions that need to die.

Morgan Housel, Motley Fool, 25 October 2011

At a conference in Philadelphia earlier this month, a Wharton professor noted that one of the country's biggest economic problems is a tsunami of misinformation.

Here are three misconceptions that need to be put to rest.

Misconception:
Most of what Americans spend their money on is made in China.

Fact:
Just 2.7% of personal consumption expenditures go to Chinese-made goods and services.
88.5% of U.S. consumer spending is on American-made goods and services.

I used that statistic in an article last week, and the response from readers was overwhelming: Hogwash. People just didn't believe it. The figure comes from a Federal Reserve report.

Misconception:
We owe most of our debt to China

Fact: China owns 7.8% of U.S. government debt outstanding.

As of August, China owned $1.14 trillion of Treasuries. Government debt stood at $14.6 trillion that month. That's 7.8%.

Who owns the rest? The largest holder of U.S. debt is the federal government itself. Various government trust funds like the Social Security trust fund own about $4.4 trillion.

Misconception:
We get most of our oil from the Middle East

Fact:
Just 9.2% of oil consumed in the U.S. comes from the Middle East.

According the U.S. Energy Information Administration, the U.S. consumes 19.2 million barrels of petroleum products per day. Of that amount, a net 49% is produced domestically. The rest is imported."

So most of us are guilty of over emphasizing and exaggerating our economic situation. It's good to have the facts so we can work on what to do about them.

Which candidate follows your beliefs more closely? Take this survey, the answers are revealing but I must admit I didn't know which of the answers is best for the country as they are very detailed and when you choose one, it closely aligns your position with the stated position of a candidate.

Can anyone guess which candidate's platform aligned with Ed's quick answers to the survey? I don't support the one it chose and the one I have agreed with most lately came in third.

Ed