If a disaster is capable of crashing the world financial system, an earthquake in Tokyo is surely one of them.
Tokyo, with over 33 million people, is the epicenter of finance and politics in Japan. In geologist Peter Hadfield’s 1995 book, Sixty Seconds That Will Change the World-The Coming Tokyo Earthquake, he wrote:
“Envisage Los Angeles, New York, Chicago, Washington, Houston, New Orleans, Philadelphia and Detroit, plus the next 42 largest cities of the United States—whose combined populations equal one quarter of the United States—with all their attendant financial, political, mercantile and petroleum-refining resources, grouped into one continuous urban conglomeration…Put that on top of the San Andreas fault and watch the sparks fly.”
Estimates of how much an earthquake in Tokyo would cost and when it will happen vary considerably.
Source (Flynn et al 2016, Takenaka 2012):
- $856 billion, 23,000 deaths, 70% chance of 7+ quake within 30 years in Tokyo (Tokyo metropolitan Government)
- $2 trillion (214 trillion yen) in 9.0 earthquake + tsunami, 323,000 deaths
Source (Artemis 2013):
- Over $3 trillion, 7.3 magnitude earthquake beneath Tokyo, 48,000 deaths, 70% chance within 30 years Over $4 trillion, 8.5 Sagami Trough earthquake, 124,000 deaths
- $510 billion insurance industry loss (larger than the global property catastrophe reinsurance market)
Source (Birmingham 2013): $1 trillion, 7.0+ earthquake, 11,000 deaths, 70% chance by 2016 (University of Tokyo)
Source (oilprice 2012)
- No cost estimate, but the University of Tokyo estimates a 50% chance of a 7.0 or higher earthquake in Tokyo within 4 years
- A 7.3 quake would kill 6400 people, injure 160,000, and destroy 471,000 homes and buildings, mainly from fires but also liquefied soils (Japan Agency for Marine-Earth Science and Technology)
If the earthquake happens during energy decline, recovery will take even longer and less extensively, since it is energy after all, not money, that is required to actually accomplish rebuilding. And Japan has no oil or natural gas resources.
In addition, there are many nuclear power plants near Tokyo (i.e. Fukushima, etc.,) that could be damaged and cause additional harm:
Alice Friedemann www.energyskeptic.com author of “When Trucks Stop Running: Energy and the Future of Transportation, 2015, Springer
Artemis. November 22, 2013. M7.3 Tokyo earthquake could cost $3 trillion in economic losses. www.artemis.bm
Birmingham, L. March 20, 2013. Two Years After Fukushima, Japan Worries About the Next Big Quake. Time Magazine.
Flynn, F., et al. April 26, 2016. Tokyo Races Against Quake That Will Shake World on `X’ Day. Bloomberg.
oilprice. March 8, 2012. Tokyo Warned that “Big” earthquake coming. oilprice.com
Takenaka, K. August 29, 2012. Giant Japan offshore quake could kill 320,000. Reuters.