By Goh Eng Yeow
Markets Correspondent
engyeow1@sph.com.sg

 

My friends said I was very lucky. As of today, I am exactly back from Japan for a month.

Just four weeks ago, I was happily in the now disaster-struck Sendai region, bathing in the hot springs and enjoying the excellent food served up by the inns there.

It must be a huge nightmare now, seeing the ongoing update given by the various TV stations on the impact of the earthquake and the subsequent tsunami on Sendai and the surrounding region.

I wonder what has happened to the scenic Lake Tazawako region – an hour by train from Sendai – which I have made a point to visit each time I am in Japan.

And as I write, the tremors in the jittery Japanese stock market are beginning to be felt in other Asian markets.

In all, the Nikkei-225 Index has fallen by almost 14 per cent since the earthquake erupted last Friday.

Almost half of its loss was due to a knee-jerk sell-off Tuesday morning as the Japanese government warned that radiation levels at one damaged nuclear plant in Fukushima had reach levels which might harm human health.

And that had horrendous consequences on regional markets – with Hang Seng plummeting 3.5 per cent, Shanghai falling 1.8 per cent, and the STI here down 2.24 per cent.

FAVOURITE STOPOVER 

Now Fukushima city is one of my favourite stopovers – a modern metropolis whose train station boasts a tasty and inexpensive sushi outlet. It is only 1 ½ hours away from Tokyo and many of its inhabitants work in Tokyo.

And that is the scary part: The nuclear plant, which is located near Fukushima, is close to Tokyo, and it is threatening to spring a radiation leak.

If that unthinkable event happens, it will be a disaster of epic proportions all right, given the millions of people who live in and around Tokyo.

So, I am not surprised that the nervous Japanese stock market is reacting in the way it did this morning, with the Nikkei-225 plunging about 6.5 per cent.

The earthquake and subsequent tsunami in Japan had coincided with the second anniversary of the bull-run triggered off by the apparently successful efforts of the US Federal Reserve and other central banks in staving a collapse in the global financial system two years ago.

Now with the possibility of another huge calamity unfolding before our eyes, I am wondering who will ride to the rescue this time.

Many writers have praised the Japanese for their extraordinary discipline in the face of such a big disaster – the lack of looting, patient queuing at half-empty departmental stores and the helping hand extended to others in need.

But tough questions will also need to be raised on the use of nuclear energy. "How could it be that there are so many nuclear plants dotted in Japan, all so close to the coastline?" one Japanese professor asked.

To complete this blog, I would like to share a picture of myself at the Lake Tazawako region before the horrendous Japanese earthquake. Who would have believed one month after this picture was taken that such a huge disaster would have overtaken Japan?