A climactic day on which the old order was left in ruins

For the best snapshot of these climactic hours in the Iraq crisis, look not to the diplomats, the media or the innocent who are fleeing from Baghdad. Look to the markets.

In the moments after Britain and the US cleared the decks for war, prices on the New York Stock Exchange did not slump. They soared. Not out of hunger for the conflict, but from relief that at last the uncertainty has lifted.

In yesterday's stunning sequence of events, many of the things we had speculated over, worried over and hoped would not happen, did happen. There would be no second resolution. The weapons inspectors headed for the airport. George Bush was preparing to speak from the White House, to tell his country and the world that diplomacy's hour was over, and that Saddam Hussein and his henchmen must leave the country – or else.

In London, high drama engulfed domestic politics as Robin Cook resigned. In Washington, the Pentagon claimed to detect signs that President Saddam was preparing to unleash chemical weapons against the 250,000 American and British troops massed on his borders.

Scary stuff indeed. But at least we know what the next few days will hold.

Either the Iraqi regime packs its bags, or there will be a war that most experts predict will be short and decisive. Wall Street, which knows a short-term, one-way bet when it sees one, was 250 points higher by mid-session.

But markets are less good at assessing the intangibles of the medium and the longer term. Intangibles abound as they have not since 1945. Everyone senses we are at a turning point, the moment when the full extent of transformation wreaked by the terrorists on 11 September 2001 became apparent.

Yesterday, one suspects, an old world order died. Wise old heads say the damage can be repaired – that once America's unrivalled military might has swatted President Saddam from the world stage, much of the present anger will be forgotten.

But will it be that simple? The relationship between Britain and Europe looks shakier than ever. Resentment of American power, in "old Europe" as well as in the ranks of al-Qa'ida, will only increase. The United Nations has been dealt a terrible blow. The Middle East may be thrown into even greater turmoil. Those Wall Street operators should take yesterday's profits and run.