As stated by Corey McGlone in his article on String Literals.The moment we write a statement like:
String one = "anything";
a reference to string "anything" is created.But in Thinking In Java,Bruce Eckel says that a reference is only generated when we define anything using "new" and only then the variable's reference is created on the heap.
The how is it that here a reference is created for the string and that too on the heap?
It sounds like you're confusing the words "reference" and "object". If you replace the word "reference" in your paraphrase of Eckel with the word "object", then it's correct. In the sentence from Corey's article, yes, a reference is "created", although this is really not such an event as an object being created, which is what Bruce is actually concerned with.
An "object" is a real, physical lump of memory, whereas a "reference" is a pointer to such a lump -- a "name" for it. Objects are created on the heap when you use "new"; references don't need creating, and they can live either on the stack or in the heap.