I like Federer better, but Nadal has upped his game lately. I think Federer is fading fast.
He's world no.1 and top seed at the US open! Before wimbledon he hadn't won anything for a couple of years granted, but he is still the best player in the world and at his age that is a massive achievment.
Also, he holds the record for most weeks at no1. as well as the most Grand Slams, which Nadal is closing in on
Nadal also has claim to beating Federer on Grass and winning Wimbledon twice! Federer could only win the French the one year Nadal was injured and lost to Soderling in the semi-final. He said himself he hasn't got a problem with the clay court, just the Spaniard opposite. He's only ever taken one set off him on the clay courts (6-1 and Rafa responded with a 6-1 of his own). Certainly Nadal is the greatest clay court player of all time.
He might eclipse Federer, but he hasn't got the type of game to last as long as Federer. He relies on speed and power, whereas Federer reads the game better and uses more technique. Also, Nadal's knees won't last till he's 30.
This debate reminds me of the Messi vs. Ronaldo thing. One is older and predominantly right footed/handed. The other is a left-handed speed freak.
IMO it's Federer. And Ronaldo