Loyalty has all but disappeared, with sworn enemies sniping about each others' drinking habits. So when, on Monday last week, the coming hurricane of the global financial crisis combined with the resignation of Scotland Office minister David Cairns, a sense of resignation quickly emerged. "There was a feeling of quiet despair," says one official.

Wheel forward 48 hours, however, and a quite different mood prevailed. Brown, having been made aware of the plans of an HBOS takeover on Monday, had given the nod to Lloyds chairman Sir Victor Blank that the Government's competition concerns would be waived. It is widely assumed that it was Downing Street that then leaked the news of a deal to the BBC, in the process rescuing HBOS from speculative oblivion. A strange feeling began to seep around Downing Street, with regard to the embattled Prime Minister. "There was a realisation which went around that, hey, this is what this guy is good at," said one aide.

When Brown came into office last summer, his popularity soared as he was seen to have dealt well with various crises, from the flooding of England to foot and mouth. He may be criticised today by Alex Salmond for having failed to offer a loan to HBOS to tie it over last week, and there may be dark theories about why he appears to have kept the deal under wraps, but the crisis has allowed him to appear in a better light. So have the events of the week and Britain's apparent escape from financial apocalypse rescued him from the fall?

Certainly, the Brown camp arrived in Manchester on Friday for the party's national conference a relieved bunch. Only two weeks ago, there had been a feeling that Brown was going to be subjected to a bloodfest so grisly that "the Borgias would quit town". The mood has changed. The Prime Minister is expected to repeat his oft-used claim in his speech on Tuesday that, in tough times, Britain needs a leader with the mettle and experience to sort it out. What is warming Brown's allies is that, after last week's financial mayhem, events appear to have borne him out.

What is more, the financial crisis also had the effect of knocking the growing rebellion against Brown – which climaxed in Cairns' resignation last week – well away from the front pages. By the end of the week, with the Labour family about to get together for conference, nobody was going to spoil the party. Few are expecting anything other than a strictly on-message call for Brown this coming week.

"It's going to be unity, unity, unity," said one senior aide. "On the conference floor, at any rate." And there's the rub. For while the events of the last week may have ensured that Brown will avoid any public humiliation, many Labour MPs believe that the stay of execution is only temporary. One anti-Brown MP said that this week's event should be compared to the Tory conference of 1990. There, Prime Minister Margaret Thatcher had received a rousing reception, famously bringing the party faithful to the feet with her rendition of the Lib Dems as a "dead parrot". Within six weeks, it was she who was a political corpse.

Even Brown's friends are now suggesting that the Prime Minister is living on borrowed time. Lord O'Neill of Clackmannan, a close ally of the PM's for more than 20 years, told STV's Politics Now programme last week that if Brown loses the coming Glenrothes by-election and the European elections next summer, a change of leader is required. Some of those in the anti-Brown faction suggest that O'Neill's comments reveal a new defensive strategy – under which the Brown camp will urge potential rebels to keep their guns holstered until next summer, as they seek to haul their man through the winter.

Perhaps as a result, the question of timing now weighs heavily on the rebels' minds. "They (Downing Street] are playing for time," says one. "They are hoping that by keeping him in till next summer, everyone will decide that it's too late to do anything." Another adds: "If we don't do anything now, we will look back next summer and say this was the window when we should have acted. We had the chance."

Going back to 1990 again, they note it was members of Thatcher's Cabinet who moved to oust her. Huge pressure is being placed on wavering members of Brown's Cabinet to follow suit. Mixed messages are coming from that front. In public, ministers such as David Miliband, John Hutton and Des Browne have all offered their unqualified support. But in the view of many Labour figures, the view in private is not so positive. According to some Labour sources, the mood of the Cabinet was summed up during a meeting in Number 10 last week at which ministers met to discuss their political strategy ahead of the election. Instead of focusing on his own problems, Brown is said to have spent most of the time dwelling on the flimsiness of David Cameron's vast poll lead. There are claims that, by the end, some Cabinet ministers had given up listening and were talking among themselves.

So will they act? Nobody can say. The rebels believe they must – and must do it soon. By ousting Brown now, they declare, a new leader would get a few months to bed in before an inevitable general election next spring. All they are waiting for now is a flashpoint. It could be the first opinion poll after conference season ends on October 1. Or it could be the Glenrothes by-election, likely to take place on November 6. There, in Brown's home backyard, the signs are not promising. Frank Roy, the Labour MP who acted as campaign manager at the Glasgow East by-election, is said to have walked out two weeks ago. The other MP who was supposed to lead the campaign, a certain David Cairns, is now persona non grata. Few in the party expect anything other than defeat.

Brown does have several things in his favour, however. Despite the resignations last week, even the rebels themselves insist there is no organised plot against him. "It's basically a few independent cells," says one MP. "It isn't organised in that sense." Then there is the lack of an obvious alternative. Claims that former Home Secretary John Reid was planning a comeback were scotched by friends last week. Meanwhile, a poll of Labour activists last week, asking who would be their preferred choice, showed that the winner, Miliband, could only muster 24% of the vote.

So for Brown, an opportunity presents itself. The PM's speech on Tuesday has been months in the writing, with input from everyone from Democrat strategist Bob Shrum to Alastair Campbell. Brown is expected to try and draw a line under his first year in office, proposing a fresh start between himself, party and country.

Last week's extraordinary events have undoubtedly helped him. If he seizes his chance this week, his leadership could be secure. But just as the financial vultures sank their grip into a weakened Bank of Scotland, so a political flop from Brown this week will see his end come ever closer.