How could power imbalance lead to war? How could power imbalance allow for mutual optimism? I analyze these questions using a formal model of incomplete information, where two parties bargain over two periods. I argue that power imbalance causes war because the strong party wishes to crush its weaker opponent, obviating the need for future concessions. This dynamic also explains how the two countries could be mutually optimistic about their path to victory, under two-sided incomplete information on capabilities and resolve. The strong country hopes that its enemy lacks the capabilities to survive the initial battle. The weak country hopes that its enemy lacks the resolve to continue the fight. I illustrate this argument by reevaluating the dynamics of the Pacific War of 1941-1945.