In a week where investors clearly didn't believe everything they read, views of the recovery diverged, despite important pieces of good economic news.

On Thursday, the Commerce Department reported a 3.5% increase in gross domestic product, the first sign of economic growth since mid-2008. The market responded with predictable enthusiasm, as the Dow Jones Industrial Average notched a 200-point gain and investors heralded the start of a real recovery. Then Friday s 250-point selloff left investors worse off than they'd been at Wednesday's close.

Many economists and market strategists still think there's a reasonable template for a modest recovery that neither keeps the economy mired in gloom, nor returns to the giddy dynamics of another bubble. That's not going to happen in lockstep with a bull market, though.

Mary Ann Bartels, who heads up technical analysis at Bank of America Merrill Lynch, looked at technology, the sector that's been out in front of the recent rally, and saw that the market may be bouncing due to a leadership change in outperforming stocks.

"New recovery highs have been reached but additional negative divergences have formed," she wrote Oct. 26. "Technology is still holding, but the leadership group, semiconductors, is not keeping pace and is showing signs of weakening. These are clear signs of an aging market rally."

Gluskin Sheff chief economist David Rosenberg said the entire market was still well out in front of the actual recovery, calling the recent rise a "monstrous rally that has far exceeded the macro fundamentals."

"In the U.S., the stock market has been behaving as if we are somewhere in the third year of an economic expansion; and here we are still debating what month the recession ended (alas if it ever ended at all)," he wrote Wednesday.

Jeremy Grantham, chief investment strategist at Grantham, Mayo, Van Otterloo, said in his monthly commentary for October that recovery may well be here, but that it will be tepid at best.

"The normal tendency of an economy to recover is nearly irresistible and needs coordinated incompetence to offset it like the 1930 Smoot-Hawley Tariff Act, which helped to precipitate a global trade war," he wrote. "But this does not mean that everything is fine longer term. It still seems a safe bet that seven lean years await us."

A more moderate view came from LPL Financial chief economist Jeffery Kleintop, whose view of current conditions points to echoes of 2004 much more than 1930, when hopes for a speedy recovery were dashed. He said earnings growth for S&P 500 companies, the actions by the Federal Reserve, the outcome of the congressional elections, and the performance of the stock and bond markets all followed similar patterns five years ago.

"Why not?" he wrote on Oct. 26. "After all, 2009 looked a lot like 2003 in terms of stock market performance, key economic barometers, the dollar, and commodities prices."

Another more upbeat view came in from global bull Ed Yardeni, founder and chief economist at Yardeni Research. Although confidence in the stock market rally is very brittle and it wouldn't take much to crack it worsening unemployment, weak consumer spending or an extension of financial sector weakness are all factors he said Wednesday he's counting on better-than-expected earnings to more than offset such disappointments.

"The big bet in my investment thesis is that the New World can grow rapidly even if the Old World stagnates," he wrote. "This contradicts a fairly widespread and somewhat colonial view that 'they' can t manage to prosper without 'us' leading the way. Indeed, if they succeed, as I expect, then some of the resulting prosperity in the New World could very well trickle down to the Old World."

Looking at the strong results that continue to make this earnings season positive, Barclays Capital strategist Barry Knapp said those positive results will only continue if government stimulus does.

"We continue to believe that the outlook for monetary policy is the most important factor for equity prices and will continue to be for the balance of 2009," he wrote.

And ISI Group founder Ed Hyman said Friday that as profits rise, driven in part by that global recovery, U.S. unemployment will ease though it could hit 10.5% before it reverses. "The point here is that this surge in profits can be explained by fundamental forces, i.e., it's believable."