"It's a miracle," they said. "Look! A brand-new 3-billion strong market," they told us. "And 12% growth! Wow!"

Top it all off with an Olympic extravaganza, and China was an irresistible story.

But that's all it was: a fairy story.

What you haven't been told is that many companies in China are so corrupt, and so bankrupt, they make Enron look like a bright light of fiscal rectitude.

The press reports that the Shanghai A-Share Index is down 70%, but that's not the real issue for you.

The real issue is this: U.S. firms have partnered with characters you'd hesitate to have to dinner. So catastrophic are these losses going to be that every U.S. company involved with these scoundrels faces a terribly uncertain future.

Exhibit One: Tao Shoulong, who ran China's biggest textile dye operations. Tao's factories spread across 31 football fields' worth of real estate in Shaoxing.

One morning a few weeks ago, Tao burned his company's financial books, disposed of his fleet of Mercedes S-600 sedans and vanished. He left behind 4,000 workers, debts of at least $200 million, 300 suppliers and 200 customers in the U.S. and Europe.

The farce was over for Tao, and by December 31st this year it will be over for 100,000 similar plants across China.

This 100,000 number, by the way, is what Beijing will admit to. So triple that.

Did You Know This?