As American troops move into the Persian Gulf and George W. Bush wags an angry finger at Saddam Hussein, a nervous euphoria is descending on Iraqi Kurdistan, the enclave in northern Iraq protected by the "no-fly" zone and governed by Iraq's rebel Kurdistan Regional Government. The feeling is very different from that in Europe, where the American president is constantly being admonished for his "cowboy" tendencies.

"Occupy us -- please!" a Kurdish man on the street demands of an American visitor. Indeed, the main fear of Iraqi Kurds I spoke to is that Washington will not attack.

"Iraqi officials warn us that Bush is all talk, that America will not invade," says Ismet Aguid, a former Iraqi foreign service officer. "But we remain optimistic."

During their 12 years of freedom, the Kurdish, Turkmen and Assyrian inhabitants of this land have rebuilt most of the 4,000 villages Saddam Hussein's troops bombed and bulldozed into oblivion. They have also created at least the semblance of democracy, complete with elections and a representative parliament.

They have laced the country with highways and transformed Sulaymaniyah, Irbil and Dohuk into modern cities with multiple newspapers, traffic jams and omnipresent Internet cafes. The people are warm and well fed, thanks to the Iraqi-U.N. oil-for-food program.

But with Turkish tanks hovering above Dohuk, an Islamic militant group shelling Halabja and Saddam Hussein's troops patrolling their southern border, Kurdistan residents realize all too well how fragile their beautiful new world is. That's why they hope that the "top secret" American airstrip near Sulaymaniyah will be put to use soon.

Not only Iraqi Kurds but also Iranians, Turks and even Baghdadis are literally betting that American victory will be swift and total. Speculation on Kurdistan's currency has caused it to spiral dangerously out of control. The local currency -- the 1991 Iraqi "Swiss-print" dinar -- trades at 7.6 to the dollar today, up from 15 just last June. The currency is disappearing from circulation, bringing the market and much-needed U.N. reconstruction projects to a standstill. The dinar travels to traders on the Iranian, Turkish and Iraqi government borders. The 12-year-old tattered and taped currency notes that stay home all too often disintegrate or end up sewn into mattresses.

A young friend explains: "We buy the 'Swiss print' for the future -- like Europeans buy 2006 World Cup tickets. When America frees Iraq of Saddam, each original Iraqi dinar will be worth $3 again."

And what does he think backs these dinars?

"The oil fields of Kirkuk," he answers.

But, of course, speculators will be out of luck if President Bush doesn't deliver soon. Mam Rostam, who led victorious troops into Kirkuk during the 1991 Kurdish uprising against Saddam Hussein, says Bush can do just that. "We talk to Iraqi troops on the front daily," he said. "They sell us guns. They won't fight for Saddam." Rostam fears only two things: chemical weapons and the possibility that "America will use us and leave us."

The Kurds, world-class survivors, are planning for such worst-case scenarios and working to stock emergency camps inside their borders. But they lack protective materials, medical supplies and the trained doctors who would be needed in case of chemical attack. Abudel Razaq Faeli, minister of relations and cooperation in Sulaymaniyah, fears that the U.N. High Commissioner for Refugees (UNHCR) and others will use the $37 million granted for emergency relief to set up camps outside Iraq. "How can someone hit with chemical weapons move all the way to Iran?" he asks. "The UNHCR will be receiving refugees in coffins."

Still, a strong vein of opinion about war -- and its timing -- is represented by 83-year-old Jalal Sideek Bawari, who lives in a mountain village near the Turkish border. "Now is better," he says.

The oil-for-food program has given Bawari's village a road and a new school. Before they had the road, villagers were completely self-sufficient. They planted or tended everything they ate. They carved their forks and spoons out of wood. But they were invincible.

He applauds the comfort and varied new products that "the market economy" brings. But he worries about what will happen if the Kurds' Western-backed experiment fails. "We will die," he worries. "Kurds have forgotten how to live on our own."

Mary Ann Smothers Bruni, author of "Journey Through Kurdistan," is in Iraq writing a book on the development of Iraqi Kurdistan since 1991.