The Libyan civil war is now well underway and Western involvement on behalf of the rebels has been stepped up in a big way. Not only are there airstrikes occurring but there are now troops on the ground, this is a huge commitment on behalf of the UN and one that could turn into another Afghanistan-style conflict. If the United States does get itself into a new conflict the USD is going to drop like a rock against other major currencies on forex charts against other majors. Libyan rebels are beginning to be lost during US counter attacks on Gaddafi and this leaves many wondering how truly effective this campaign may be.

The United States is stretched very thin both financially and militarily and entering into yet another military conflict could frustrate US investors such as China in a huge way. Politically the Chinese are already citing the US for attacking a country without real provocation, if this goes from political to financial then China may take action against the United States. If China does move forward with plans to distance them self from the USD then the USD will fall against majors like the Euro on forex charts quite dramatically.

Libyan supporters of Gaddafi's regime are creating a stalemate type situation in which Gaddafi could stay in power despite the revolution and then be an enemy of the US. The United States needs to either remove Gaddafi from power or leave the conflict immediately, the US has enough enemies in the global community and they do not need anymore. An all out invasion of Libya could be a huge liability of the proportions that could see the United States on the fast track to bankruptcy. The fact that other Arab countries are beginning to also experience turbulence means that there could be several other countries going into chaos.