The Dow slipped 161 points yesterday. Oil settled at $106. Gold at $900.

And now it’s winter.

We know that because we saw a picture in the English newspaper. There was a group of Druid priests, dressed in white robes, celebrating the autumnal solstice. It’s colder weather from here on...until spring.

We had a dream last night...a nightmare, really. It came as a flash of insight...a look into the future...a dark night dread of what is coming:

What has the War on Terror accomplished? The terrorists – whomever they are – go about their business. But the war has brought together the governments of the planet to work together in an international, coordinated attack on free travel and the free movement of money. This is, curiously, the New World Order, that Bush 41 described 15 years ago. It has become more real, thanks to the War on Terror.

Just try to open a bank account; you’ll see what we mean! The bankers want to know everything about you. Otherwise, they could be held responsible...like a bartender who fails to ask for a photo ID.

The War on Terror has also accustomed people to waiting in long lines...and taking orders from morons. “Take off your belt...” “No jokes...” “Stand over here...” “Put up your arms...”

Once, we risked prison and asked: “What’s the magic word?”

The guard was not amused.

And now, we have the equivalent of a ‘war on bear markets,’ one that will require an international, coordinated attack on free markets.

In our dream, a new world currency had been issued. Paper money, of course – and backed by a consortium of nations and central banks. Use of any other form of money was prohibited. Pull a gold coin out of your pocket, and you were treated as a terrorist – a threat to the whole planet’s financial security.

Hard times had come... bankruptcies, defaults, and unemployment were common. We, who had tried to protect ourselves with gold, found ourselves with a pile of coins...but no way of using them. Otherwise, we were broke...penniless...wondering what to live on.

We could get a pittance from the government. But we would have to register. Then, we would stand in line for ration cards...gas and food were rationed – because we were at war! No jokes or criticism were allowed. Neither of the ‘war against bear markets’ nor how it was managed. This was serious!

Could a world like that exist? We don’t know. But progress is no sure thing. There have been periods of backsliding...depressions...Black Death...and Dark Ages. Life has its winters.

“Historically, there has been one major plague every 100 years,” says a colleague in our Paris office. “The last one was about 90 years ago. It was the worst plague in human history...in terms of the people it killed. More people than died in WWI.”

But surely medical science has made progress, we replied. Now, we don’t have to worry so much, no?

“Not so!” was the answer. Of course, there’s been a great deal of progress. But these tiny bugs mutate and spread faster than medical science can react. It is just a matter of time until one of them goes berserk.

Apart from the risk coming from Mother Nature, there is also the risk coming from ourselves. Human institutions evolve like bugs too. And every once in while, they work themselves into an awful state – before anyone realizes what has happened or what to do about it.

After hundreds of years as masters of the entire Western world, in the 5th century the Roman Empire seemed to disintegrate. It could no longer maintain bridges and roads...it could no longer collect taxes...it could no longer hold off the barbarians. Soon, Rome was sacked and the barbarians took control.

Property in downtown Rome went into a bear market, from which it did not recover for probably at least 1,000 years.

And then, in the early 20th century, something went terribly wrong again. The French and the Germans went at it – over nothing, it appeared. Then, the British made the mistake of getting in the fight...followed by the Americans. In retrospect, we see that there was never anything at stake worth fighting over. But once underway, no one had a way to bring the war to a close. It just kept going until millions were dead, and almost every government of Europe was either toppled or bankrupt – usually both. The noble houses – the Hapsburgs, the Romanoffs, the Hohenzollerns – all died in the trenches. So, did the Ottoman Empire...France and Britain were broke.

Then, the very year in which WWI finally ended, came the Spanish Flu epidemic – which laid down another 30 million people.

And then, 20 years later, a new generation was ready to do it all over again – with another worldwide war and all that went with it.

*** And the markets hold their collective breath today as the debate over the proposed $700 billion bailout rages on. While this bailout does little to protect U.S. taxpayers – who, incidentally, will be the ones footing the bill for the bailout – the oil market will certainly stand to benefit. That is, if everything goes as planned.

Oil prices have been falling for a while now, due to the fact that a struggling consumer economy has squelched demand for the black goo.

But, as CNNMoney.com points out this morning, if the bailout focuses on “jumpstarting” the faltering economy, ostensibly, consumer sentiment will rise and so will demand for oil. Also, this major injection of liquidity in the markets, along with the printing presses working overtime to get more and more dollars into the markets would likely devalue the greenback. And since crude is traded in U.S. dollars all over the world, a falling dollar means rising oil prices.

We’ll see if this is really the adrenaline shot the oil markets need to recover...or if a intrinsically weak U.S. economy will prove to be harder to bandage that that. We’re putting our money on the latter...

Bill Bonner is the President of Agora Publishing. For more on Bill Bonner, visit The Daily Reckoning.