
Ever since the screen flashed to white, there have been countless discussions at to what exactly happened, or what is really happening on the show! Most notable of them all is "has the H-bomb really gone off?" and for those who believe it has, then "what has happened to everyone who was stuck in 1977?"
From the last podcast, dated May 18th, 2009. Michael Emerson was interviewed and mentioned that, as he read the script, it clearly stated that the H-bomb had gone off. Now this may be a deception to the actors themselves. But if it's true I do not necessarily consider it a spoiler as there clearly was an explosion sound and, if it's in the script, that's cle arly what the writers want us to believe. So assuming the bomb did go off, WHAT HAPPENS NOW?
There are many theories floating around. One is that the bomb was the incident and now Juliet is dead and everyone is stuck in 1977 until some time traveling event occurs again. Another is that Juliet is dead and the bomb was the incident but it created the time traveling event and everyone is back in 2007. There are many variations: time has been altered and everyone (or a group of people) start back in 2004, before/after the plane crash. They have different/same memories... blah, blah, bleh! In short, we have probably been left with more questions about the end of the show than actual answers as t what is happening!

This is where I come in. I try to suggest a theory as to what is happening. This is by no means what I think will definitely happen and will not cover everything that is the Grand Unified Theory of
Lost. The key component in all of this is the mighty
and powerful, compass. It's been posited that the compass could be in a self-consistent loop, where it has no creator and no death. But the issue I always had with this is the actual
decay of the object itself. If the compass was in a perpetual, self-consistent loop, then the decay it presents (by Richard's own admission) would be an inconsistency and would probably result in the universe collapsing once the object reached inexistence.

But lo and behold, the writers have planned for the compass and what exactly it represents. Although one cannot consider the podcasts to be certified canon, they provide certain clues, one of which was that the writers mentioned the compass was in a
Moebius Loop (google for references.)
Now this theory may not quite accurately describe how a Moebius loop may be in time, but it certainly is inspired and takes from its characteristics, most notably that it is a non-orientable surface. So before keep on reading, you may want to brush up on the subject.
Back? Then I assume you are ready for the following mind bender! Note that the following may not exactly take care of what Moebius Loop the compass is in! Funny how the inspiration did not get included. I'll speculate on it later on.

So you are probably aware that a Moebius strip is a surface with only one side and one boundary component. What this means is that, by following its edge from a given starting point (colour/year), one would eventually return to the same general surface (colour) but on the other edge, as can be seen from the red edge:
To understand how this may apply in a time-travel/history context, consider how one can build a Moebius loop. You take a long strip of paper, give one of its ends a half twist and then tie them together:

From a temporal problem, let's assume the strip is a temporal strip of time looped unto itself. To ease the visual representation, let's say the strip goes from 1977 to 2007. One would see that a simple strip folded unto itself would create s single looped edge/surface. But in a Moebius loop concept, the repercussions can be quite intriguing. Consider the following as reference:

As stated, in a standard loop strip, history would form an AB band from 1977 to 2007. But in a Moebius loop, we go from an AB band to a BA band. The idea is that by starting at the point 1977-
A and letting time flow, one would reach 2007-
A, which converges to 1977-
B and flows to 2007-
B, and seemingly converges to 1977-
A again. What this means is that, in a full loop that starts and ends in one single, indentical point (1977-A), one has to go through twice the length of the loop: 30 years (A) + 30 years (B) = 60 years. History repeats itself.
Or maybe it actually doesn't! And that is where the actual theory kicks in. Obviously, I have not selected the previous years arbitrarily. But instead of having a single year connection (1977/2007), it is possible to consider that the convergence

occurs over a
3-year period (1974-1977 / 2004-2007). In a sense, the two periods allow for traveling to the other side. Although what we've seen on the show was a unidirectional movement, there are no reasons why this movement couldn't be bi-directional. Implying that individuals from the 1974-1977 period could travel to the 2004-2007 period.
This representation indicates that there are
two different occurrences of the period 1974-2007. One would represent the events as we've heard about them in seasons 2 through 4. The other would be the one affected by the events we've observed in the current season. Where does that put everyone? well consider the first loop (the red edge discussed earlier) to be what we've all seen before. Comes 2004 when Ben and Locke turn the wheel and LaFleur's crew gets stuck in 1974. This would be the first occurrence of 2004 and the second of 1974. The same is true during the Ajira flight. In the first version of 2007, Jack's group flashes to the second version of 1977. This is why Jack could actually change the history as we have come to know it, he is in fact affecting the second historical loop.
So, if we are to believe Mr. Emerson's claim that the H-bomb indeed go off near a super charge of electromagnetism, then one could easily believe that this closed the temporal band (74-77/04-07) and will return Jack's group back to the second occurence of 2007, meeting Sun, Frank, Ilana and Ben.
THAT'S RIGHT, everyone who was on the Ajira flight and did not travel back in time landed not in the first occurrence of 2007 but in the second, which has already been affected by Jack and Sawyer.
Remember that on a Moebius strip, every single point at the loop is exactly in synch. In the construction shown earlier 1977-A was converging from 2007-B and both were joined by the band to the 1977-B/2007-A point.

This shows that in the proper conditions, someone within the 2004-2007 period could either:
1) remain in that first occurrence;
2) travel to the second occurrence of the past period; or
3) travel to the second occurence of their current period. There are different implications for each of the possibilities:
A) one would incur a change in memories and either remember or forget all of the past once the end point of the convergence ban arrives;
B) affect the second historical loop; or
C) have all memories intact but live in an alternate historical reality. Memories of the first historical loop but living with events of the second loop.
What happens to those who do not change points on the band? Well, we have an example of such an individual in Richard. Since he is special to the island, this may not be the best representation but bear with me. When we first meet Richard in season 3, one would assume he has no recollection of the lostaways dying in the past because that is the first occurrence. When Sun meets him in 2007 (post Ajira), he remembers his friends dying, because he has the memories of the second history loop. Since he hasn't traveled in time, when he hit the convergence (which likely only exists on the island), he gained the memories of tat second loop. Whether or not he remembers the earlier events, one would believe so since he remembers Locke disappeared when Ben turned the wheel, but it is hard to know exactly how memories are affected in the convergence band, I'd like to speculate but I haven't seen enough to do so.
What does that make anyone think of? If you said simple case of changing history, then you're wroight (is that a word? If not I'm submitting it to Merriam-Webster). So far, this theory has only a loop that goes twice form 1974 to 2007 and starts over again! Well there needs to be entry and exit points, and these are just the past before 1974, or an edge leading
to 1974-A and a future post 1977, or and edge leading
from 2007-B. With that in mind, you can just consider that time flows as is and someone travels back and changes the past and then returns to his original time. This almost makes this entire theory just a method of suggesting time travel allows for changing time. But the difference is that it allows for the seemingly creation of paradoxes.
The main paradox being that the incident happens, the hatch is built, the plane crashes, Jack experiences difficult times, goes back to the island/in time, detonates the bomb that prevents everything, including the possibility of Jack going back in time to prevent the paradox. But since the concept of Moebius loop/strip was put into place, this allows for the creation of contradicting events.
Another possibility of the loop is that time travel was always a component, but on one side (A) Jack could not affect the past while on the other (B) Jack was able to. If you look at some of the characteristics of a non-orientable surface, you get that an object being slid across the surface can come back to its starting point as a mirror image of itself. This is what this version is, one version where the bomb does not go off and another version where it does.

I realize I have not touched on the compass, and I claimed I would not do so. But let me just mention a few things. The compass could be part of a greater loop than what I've elaborated, or it could be that the creation of the loop (by turning the wheel) affected several points in time in that it created some smaller Moebius loops between periods, such as 1954 and 2004. This would present the possibility that two John Locke talked to the various Richards we've seen. But given the revelations from the finale, this possibility may require a whole other post on the what our new found nemesis has had to go through to find his loophole.
In the meantime, consider what I've said and, hopefully, this will lead to several more theories!