ASIAN markets rebounded strongly in the wake of turmoil in global stock markets but is the sharp advance and a massive interest rate cut by the US Federal Reserve (Fed) sufficient to convince people a US recession will be avoided?
The markets are in a flux as the bulls and bears engage in a huge tug-of-war on that subject.
Listen to the bulls and they will say that the 75 basis point cut by the Fed was just the tonic the market and the US economy needed to pull away from the current slump.
They will say that the planned economic stimulus package by the US government, lower commodity prices, especially petrol prices in the US, and slower manufacturing activity will ease inflationary concerns.
Lower prices and an economic stimulus package will put money back into the pockets of the US consumers and that will help the economy avert the much-dreaded recession.
Market bears, however, are singing a different tune. They say the wheels for a US recession have already been set in motion and cuts in US interest rates will weaken the dollar even more and cause inflation to spike up even further.
A falling dollar and the subprime-induced crisis that has now seemingly spread to the manufacturing sector and higher inflation will steer the US economy and its stock markets into a terrible state.
Furthermore, the state of economies in Europe, particularly Britain, is not on solid ground, with inflation there poised to inch higher while the property market there is undergoing a correction.
They will also say the interest rate cuts are not big enough.
A probable outcome might be somewhere between what the bulls and bears say but it is too early to tell what this will be.
Any crisis is a terrible thing to go through. Its ensuing effects on the economy can be painful.
And the world, since the start of the decade, has witnessed turmoil after turmoil, such as the bursting of the dotcom bubble to Sept 11. Those events did not produce a deep recession and served as the basis for the years of a liquidity-fuelled boom that saw economies throughout the world hum in unison for years.
Such a recipe is easy to revert to, as investors know that the panacea for many of the ills was cheap money, and lots of it. That prescription is set to be administered once again but whether it will be enough this time around will be known in the months ahead.
Economic data will show just how the US economy, and that of Europe and Asia, will deal with the unfolding events that have been brought about by the subprime crisis in the US.
And until a clearer picture emerges, stock markets will be volatile.