Asian and European stock markets are posting gains of 4 to 10 percent this morning thanks to a coordinated effort among several governments to recapitalize banks and insure interbank loans. The futures market is predicting a similar rise for U.S. stocks. For a few precious hours, at least, you'll be able to imagine that the worst of the crash is behind you. But heed the all-knowing Web photo editors, who time and again this morning have selected only slightly less terrified stockbrokers to illustrate their market recovery stories (see left). Maybe their enthusiasm is tempered by that story in the Wall Street Journal this weekend in which 18 economists said we've been doing the bailout all wrong:

Many economists believed that the heart of the government's initial plan to pay $700 billion for toxic assets was aimed at the wrong target. Purchasing mortgage securities from banks wouldn't do anything to kick-start lending and get credit flowing again, they said. Rather, banks would use the proceeds they got from the Treasury to pay off debtors, and those debtors would use the proceeds to buy safe assets.

They said a wiser course — the one the Treasury now seems to have come around to — was for government to rebuild the badly depleted cash levels on bank balance sheets. That would cushion institutions against future losses, giving them the wherewithal to lend again.

Well, it's nice that someone finally thought to ask the economists whether these hundreds of billions of dollars are being spent wisely. Their full report if available here.