Can the Chinese “dragon” save us from the worst recession in 70 years?

It’s an important question for any investor if they plan on making any long-term investment decisions during this global downturn.

Financial newsletter writer John Mauldin gives us a big clue of what’s to come in an article he wrote earlier today…

One of the best gauges of an economy is tax collections. No one pays taxes unless they have to, so collections are a real-world, real-time analysis of the US economy. And the best source I know of for tracking taxes is The Liscio Report, by Philippa Dunne & Doug Henwood.

Tax collections are down. Philippa and Doug give us the actual numbers, which are not pretty. Bottom line? “What does this all mean? It suggests that the consumer retrenchment in this recession will be deep and long, and will probably continue into any recovery. The American consumer is no longer

Banking bailouts are nothing new. Starting with the “panic of 1792″, there have been many examples of government financial rescues. Keith Fitz-Gerald says the success of these past bailouts is mixed. And they nearly always cost far more than originally thought…

This from Money Morning:

Although the ongoing financial crisis has introduced a new word – bailout – into the lexicon of most investors, a quick tour of history shows us that these big-ticket financial rescue plans are actually nothing new.

And that raises the question: Do they work?

A look back at history shows us that – like most government initiatives – the answer is “it depends.” While some investors might find that reassuring, history also suggests that the final tab for a financial-crisis bailout will be well in excess of what it should cost to fix the problems the crisis actually caused.

Take for instance the very

Banking bailouts are nothing new. Starting with the “panic of 1792″, there have been many examples of government financial rescues. Keith Fitz-Gerald says the success of these past bailouts is mixed. And they nearly always cost far more than originally thought…

This from Money Morning:

Although the ongoing financial crisis has introduced a new word – bailout – into the lexicon of most investors, a quick tour of history shows us that these big-ticket financial rescue plans are actually nothing new.

And that raises the question: Do they work?

A look back at history shows us that – like most government initiatives – the answer is “it depends.” While some investors might find that reassuring, history also suggests that the final tab for a financial-crisis bailout will be well in excess of what it should cost to fix the problems the crisis actually caused.

Take for instance the very

Do government bailouts in times of banking crises work? Crises like this are manageable. They're expensive and painful to resolve, but even more expensive and painful when left to fester.