Today, history is being made in the Middle East. The Arabian streets woke up to the sound of sniper fire as a regime is defending itself, against the people of its own nation. The flames of anger have been fanned by decades of corrupt authoritative rule. The growth rate in populations in the middle east have produced a generation of educated youth.

Revolutionaries in Tibet, Burma and Thailand used the internet and YouTube as a way to spread the word of what was happening in their countries during times of civil unrest. Twitter however, as a revolutionary tool, came of age during the recent protests in Iran, following the rigged election of 2009.

It was during this failed attempt by the oppressed people of Iran that both sides learned the power of Twitter. The capacity of twitter/SMS to allow civilians on the streets and at home to share information between them was a new tool used by revolutionaries in a new way. The ability to decentralize communications between demonstrators electronically became the besieged Governments greatest fear.

Governments are always accused of fighting the last war. In this case, the people are adapting to newer technology, without needing to use the old forms of controlled communication. The decentralized nature of the internet gives the people a new capacity to distribute the news or changes in plans unlike anything in human history.

A few weeks ago in Tunisia we had an uprising that was so spontaneous it completely caught everyone by surprise. It happened so quickly, elements of the government were unable or unwilling to act fast enough to stop it before the army switched sides and joined the movement.

In Egypt, people have set the current Governments party headquarters on fire, as a sign of their anger after the government turned off the internet and twitter. The police and the people are meeting in a surge of civil war events. The genie of revolution has been released. The power of what Twitter has unleashed has never been more visible.

When Egypt cut all internet and twitter communications, it was the true sign of the desperation of the Government now. The autocrat Governments around the world are trembling this weekend, as the reality of the last few weeks hits home. Tunisia was not a single event and Egypt will not be the last.

The people on the streets of Arabia are standing up and shaking off the shackles of dictatorship. The Egyptian revolution is unfolding in real time, in front of the world. The Twitter revolution is still happening, 140 characters at a time, just not in Egypt at this time.

The implications of this in the world markets are unwritten, but some obvious thoughts are counter to the market trend of the last 6 months. This will not be good for emerging markets. Revolutions are bad for capital investment projects.

Fear is an interesting thing. Once experienced it changes everything, values become relative. In such a world, the US dollar becomes king again. The world reserve currency returns to its role as a medium between all traders. The US Treasury market, all warts included, becomes the most liquid place to park funds while fear rages in the emerging markets.

Fear in the market has been on hold during one of the greatest market bounces in history. That fear may have just returned to the markets. One twit at a time. The world changes.

Confessions of a Macro Contrarian www.jackhbarnes.com