The Soviet troops on patrol in the western Romanian city of Satu Mare looked more like a ragged band of thugs than the professional soldiers who had overrun Poland last year and now Romania this year. They acted little better than a common gang of thugs either, strutting around the town stealing at will and dishonoring women whenever they got the chance. Until their superiors were around, then they were the picture of efficiency.

Such had been life for several days, and the people of the city had grown used to it. The morning of the third day of the Soviet occupation of the city was to be different. German bombers droned overhead and not long after the thuds of exploding warheads could be heard in the distance. The Soviet thugs, or soldiers rather, scrambled through the streets of the city like headless chickens.

Later that day there came the steady poppoppop of small arms fire intermixed with the occasional heavier sound of mortars or something else heavier firing. Before nightfall German and Hungarian soldiers strutted around the streets rather than the Soviets. Many cheered them as liberators, others ignored them as they had ignored the Soviet soldiers. To them one occupier was as bad as another. For the days of a truly independent Romania were over. All that remained to be determined was whether Romania would be a fascist client or a communist client.

The bombs that fell on fleeing troops east of the city the next day detonated with a sad finality. The Soviets were in retreat but the people of Satu Mare, the wise ones anyway, knew they were the real losers.

The Axis Powers open up their counter offensive into Romania. A force of nearly 750,000 German, Hungarian, Romanian, and Italian soldiers and 2000 tanks move from railheads around Debrecen, a Hungarian city east of Budapest. German panzers streak ahead spearheading the attack. Infantry and minor axis forces follow, holding down Soviet forces. German Stukas range the front destroying everything that moves as medium range bombers hammer rail lines and transportation hubs behind the lines. The Red Airforce is slow to react and for the opening hours of the counter offensive the Luftwaffe owns the skies over western Romania. German commanders are getting their first real test of their concept of "Lightning Warfare"(blitzkrieg), a much more sophisticated version of the Soviet Union's "deep penetration" doctrine. The German version calls for more use of direct air support and better coordination between mechanized and infantry forces.

German panzer spearheads have cut deep salients into the soft Soviet lines and are beginning to move north and south to close a massive pocket around slower moving Soviet forces.

Two German panzer armies meet up at Cluj, successfully closing a Ring of Steel around 500,000 Soviet troops in western Romania. Further east the Soviet front is in complete chaos as Soviet forces stream eastward in a disorganized mass. German aircraft hammer fleeing columns further adding to the Soviet panic. The Luftwaffe, which has been massing in Hungary since the beginning of the war, is now seriously contesting the Red Airforce for air superiority over Romania. Neither side can quite gain the upper hand, although Soviet losses are heavier than what the Germans are suffering. But the Soviets have enough planes and pilots to absorb such losses for a long time.

As the western Romanian pocket is slowly reduced German armored spearheads reach the Soviet city of Chernovtsy on the border between Romania and the Ukraine and cut vital road and rail lines into northern Romania. Soviet reserve forces form a line just north of that city and call for reinforcements. The Germans halt their advance, unwilling as of yet to invade the soviet Union itself.

Two entire Russian armies, over 400,000 men, surrender to the Axis Powers in western Romania. Further south Sibiu has fallen into Axis hands and German forces are advancing towards the Polesti oil fields from the north.

The Soviets begin to establish a smaller defensive front ranging from the city of Roman in the north to the Romanian capital of Bucharest in the south. The air war over Romania continues to intensify as both sides struggle to support their own ground operations. In a single day over fifty aircraft are downed in a single engagement in the skies over Bucharest. The sky is full of warplanes.

France and Britain sign a formal defensive pact named the Alliance for Democracy. The U.S. remains strictly neutral although her sentiment favors the Alliance and the Axis Powers over the communist Soviet Union.

Axis forces begin to pound into the Soviet defensive lines in eastern Romania but are repulsed by the well entrenched Soviets.

The war in Romania has fallen into a harsh stalemate. Axis forces have retaken all of western Romania, southern Romania, and the Polesti oil fields but cannot break the Roman - Bucharest line. The terrain is too rugged and the Soviets too well entrenched and supplied. The air war continues but harsh winter weather is hampering air activities. The Alliance attempts to broker an armistice during this lull but both sides reject the attempt out of hand. The stalemate continues.

Early Mk4 prototypes begin to arrive at the Romanian front for field testing, but mass production of the new panzer is still months away.

Soviet forces continue a slow but steady advance towards Helsinki in Finland. More Soviet forces are now pushing towards Oulu and Tornio in northern Finland but a combination of rough terrain, harsh weather, and Finnish resistance is slowing the Soviet thrust. German infantry have only just begun to arrive in Finland in large numbers and are being carefully deployed as a strong reserve defensive force. German bombers, operating out of Finland, are beginning to hit Murmansk, Vyborg, Leningrad, and other cities vital in the supply of Soviet forces in Finland. The effects of these relatively small raids are minimal but draw some Soviet aircraft from the south where they are badly needed.

A German request to send troops into Norway and Sweden to "defend them from the Soviet threat" is refused. Hitler is outraged, and he is afraid the Sweden's vital mineral resources might fall into Soviet hands. German intelligence assets are ordered to prepare to install a pro-fascist government in Sweden, and Hitler orders the Germany army and airforce to prepare to invade Sweden and Norway to keep them out of Soviet hands.

Britain has offered to send a few thousand troops to Norway and Sweden to serve as a deterrent against Germany and the Soviets. However, not wanting to anger either the Soviets or the Germans, both countries politely refuse Britain's offer.

Germany and Japan enter into negotiations to flesh out the terms under which Japan might enter the Axis Powers.

A German submarine operating in the Norwegian Sea attacks and sinks a British merchant ship, mistaking it for a Soviet blockade-running vessel. The British protest the action and some in Britain even call for war, but in the end the British people are not ready for war with the Axis Powers. Germany's blockade of the Soviet Union's northern ports continues despite the incident.

Soviet forces reach the outskirts of Helsinki and begin to bombard the city. The Soviet thrust into northern Finland is picking up speed due to unexpectedly mild weather. German infantry see action in Finland for the first time after they are committed to the front in order to keep Soviet forces from penetrating into central Helsinki.

In Berlin the plans for the invasion of Sweden and Norway are on the drawing board and waiting to be executed. Hitler has gambled that Britain will not risk war by aiding the Swedes or the Norwegians, but is willing to take that risk in order to keep Sweden and it's crucial ores out of Soviet hands. Sweden in Soviet hands would be a dagger pointed at the heart of his Reich, and Hitler is emphatic about preventing this.

In Luftwaffe training centers around Germany a new kind of soldier has been training for just this mission for several years now. A new form of warfare is about to be born and the growing war in Europe is about to spread a little further.