Intriguing question: What happens if Iran develops the bomb?

What happens if Iran develops the bomb? That is a question often asked in the press but never really answered.  A new report from the RAND Corporation seems to suggest that Iran may be in possession of a nuclear warhead within the next eight weeks.  Admittedly, that link is from an Israeli and thus not necessarily objective news source but the original question still stands.  What would the response of the world be to an Iranian announcement that they are now in possession of a nuclear weapon?  I don’t have any great confidence that it would be anything effective.  I foresee much gnashing of teeth in Western capitals, the Chinese would probably applaud and eventually they would build a second and then someday a western city would go up in a mushroom cloud at which point the west would really get serious about the idea that it is not necessarily a good idea for a regime led by religious fanatics to have the bomb.

What do my readers think? Would we (meaning the West) invade or even do anything that would effectively deter Iran from building or using a nuke?  Nothing seems to have deterred them so far.