The worst tea is put into little white bags and sold to westerners who can't tell the difference between good and bad tea. There, I said it, downvote me to hell!
The best Chinese green tea is always sold as loose leaf tea. The leaves are usually put into a small can, with a plastic wrapper to preserve the fragrance and flavor.
It is almost impossible to get the best tea outside China, since the best green tea is picked days before 清明 (Qing Ming, normally around April 5th), which is called 明前茶 (tea before Qing Ming), this kind of tea can only last for about 6 months. After that the flavor will start to degrade. Because tea trees don't have a lot of small leaves before April, they don't yield a lot of 明前茶. Hence they're extremely expensive, even in China. I've yet to see authentic 明前茶 sold in the US.
Second grade tea is called "雨前茶", tea leaves are picked before 谷雨 ( normally around April 19-20).
Tea leaves picked after 立夏（Li Xia, or the start of summer, normally around May 5-6）are pretty much just regular tea leaves. I think most loose leaves tea are in this category. The best Green tea, 龙井 (LongJing), doesn't even use any tea leaves picked after May 5.
Green tea needs to be consumed with in the year of its picking. Flavor will degrade after 6 months. Tea from the previous year is still drinkable, but isn't nearly as good as the tea from the same year.
So what kind of green tea gets bagged? Two year old tea, bad tea leaves spoiled due to processing mistakes (tea leaves burnt when frying), tea that can not be sold as loose leaves either because the color or smell isn't right. Like I said, the worst tea is sold as bagged tea.
Same goes with oxidized tea like red tea, Oolong tea, and fermented Pu-erh tea... the best is also sold as loose tea leaves.
Now flower tea, like jasmine tea, rose tea... these are not really green tea, you drink them for fun, like if you want listen to some Strauss after Beethoven.
Jasmine tea is not really made with jasmine, they might put jasmine flowers in it for the fun of it, but the actual tea is made with second grade green tea, like I said, drink for fun, add sugar.
There're, of course, the official way to drink tea. But in everyday life, there's really no point in getting all ritualistic. I sometimes buy empty little bags so I can put my tea in it, easy to drink, easy to clean. But my dad won't use it, because he prefers to drink tea in clear glass cups, so that he can see the color of the tea, and enjoy how the leaves floats in water. (He's an even bigger tea snob than I am).
Faye Wang, Tea Snob