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Concerns of a Nuclear Meltdown in Japan Post-Quake and Tsunami

Aired March 14, 2011 - 04:00   ET




NAOTO KAN, JAPANESE PRIME MINISTER: In the 65 years after the end of World War II, this is the toughest and the most difficult crisis for Japan.


ANDREW STEVENS, CNN INTERNATIONAL ANCHOR: Japanese leaders try to move their people forward from one of the country's darkest hours, but there is still a very long way to go. TV Asahi is reporting another quake of 6.0 magnitude to the west of Japan, near Nagatao.

It's 5:00 p.m. in Tokyo right now. From CNN Hong Kong, I'm Andrew Stevens.

CHARLES HODSON, CNN INTERNATIONAL ANCHOR: And I'm Charles Hodson at CNN London. We welcome viewers in the United States and around the world to CNN's continuing special coverage of the disaster in Japan.

STEVENS: Now, as the days pass in Japan, the death toll continues to climb. Friday's earthquake and tsunami have claimed 1,600 lives so far; 1,500 people are still missing. Those figures are expected, though, to rise dramatically.

And pictures like this, the complete devastation of the coastal city of Sendai, serve as a reminder of the sheer force of the tsunami that inundated the area. The destruction is all that remains of a city that was once home to a million people.

The situation is bleak for those who have survived as well. Survivors are staying in makeshift shelters like this one at a school recovering in the city of Shirahama, recovering from the trauma of the past four days, and now waiting for news of loved ones.

And on top of all that, this Japan is racing against the clock to contain what could become a nuclear crisis. Images like this have become all too familiar, the white smoke billowing over northeast Japan, after a second explosion at a nuclear plant in Fukushima.

That plant's third reactor has now shut down.

HODSON: As frightening as this nuclear development is, one expert says caution must be exercised when describing the situation in Fukushima. James Acton from the Carnegie Endowment for International Peace explains.


JAMES ACTON, CARNEGIE ENDOWMENT FOR INTERNATIONAL PEACE: Chernobyl is a unhelpful comparison. The accident at Chernobyl was an explosion inside the reactor core. This is extremely unlikely to occur in this case.

The accident that this is more similar to is the Three Mile Island accident. Now Three Mile Island had a very different cause. Three Mile Island was caused by operation error. This was caused by a devastating earthquake followed by a tsunami.

Nonetheless, the nature of those two accidents, the challenge of cooling the core of the reactor, was the same. Now, Three Mile Island was extensive melting of the core, but very limited release of radioactivity.

What we have to hope is that there's a similar outcome on this occasion. As I said, any time you have a core melting, there's the risk of a substantial release of radioactivity, but there's no guarantee that a substantial amount of radioactivity will be released.


HODSON: You can find out more about the impact the earthquake has had on Japan's nuclear reactors on our Web site. I know you've got a lot of questions about that, as have the rest of us. So we got in touch with a number of nuclear experts and agencies to try and answer some of those queries. All of that is at

STEVENS: We've been seeing images from Northeastern Japan for a few days now. But we continued to receive new and frankly shocking video from different sources. Japanese media say hundreds of people were swept out to sea in Sendai. Take a look at these images from Friday, as alarms sounded and the tsunami hit.

Just a couple of minutes before those scenes were shot, the streets were dry. It just gives you an idea of just how quickly this water moved inland, this unstoppable wall of water. As you see there, the sheer force just obliterating anything in its path.

A lot of the pictures we have seen before. It just -- it doesn't lessen the impact when you see them again, though. It's just almost unbelievable just how much water and how much force is in that tsunami, which covered the north and eastern part of Japan.

There are still so many towns which haven't even been got to by rescuers yet. Most people say the death toll will increase quite dramatically.

Now, listen to this woman, unsure of her teenaged daughter's fate after they were both swept from a three-story building. (BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE (through translator): A tsunami hit us. I grabbed something tightly, holding my daughter's hand, but I lost my grip when I was swept away with the debris in water. I managed to survive, but my daughter was washed away.

I don't know what to say. I hope my daughter is still alive somewhere.


STEVENS: So many tragic, tragic tales like that woman looking for loved ones. So many people, so many families separated by this disaster. Certainly the rescue operations are ramping up. But hopes of actually finding survivors among some of the wreckage, some of that unbelievable wreckage are now fading.

Kyung Lah joins us live now. Kyung has been in Sendai. And Kyung, you're now down at an evacuation center. I guess some of the stories you're hearing down there from people who have lost loved ones, who barely escaped with their own lives must be quite harrowing.

KYUNG LAH, CNN INTERNATIONAL CORRESPONDENT: It's like a mini- city of tsunami victims here, Andrew. There are so many people at Shikigo (ph) Elementary School. If you look to your left or to your right, you see very old people. You see children. Though you may say these children are unlucky, because they're so young and they don't have homes, they don't understand.

And those who do, the elders, are wearing the strain of the disaster on their faces. It's very apparent. We spoke to one woman who broke down because she got food and water from people she hardly knows. She just learned from reading the newspaper, looking at Google satellite images that her home was destroyed.

Everything she owns is gone. All she had is the blanket she was sitting on and the clothes on her back. We met a new fathers whose three-week-old daughter he simply could not let go. He didn't want to put her down because of the trauma of what he had experienced these last three days.

So when you walk through these emergency shelters, you really start to understand, beyond the images that we've been showing, beyond all of this disaster that you're seeing on the television screen, behind every single one of those piles of rubble is a human life, a human story, victims who are going to take years to recover.

This isn't just an issue of cost of rebuilding. This is an issue of how these people are going to be able to get their lives back together. At this point they are still hoping -- hoping beyond hope that they're still going to be able to find some of the missing.

There's a message board up here where people are writing, have you seen my father, or I'm alive, I'm at this place. It's left and right. It's just stories that are overwhelmingly sad. STEVENS: Kyung, people who have been through a disaster of this magnitude, I mean, quite often just become numb to just about everything. Is that the feeling, the mood in that evacuation center? Are people just stunned? Or are they still trying to get on with their lives to try to find out what has happened to their loved ones?

LAH: They are stunned. You are exactly right. They cannot even think about what's next. The father that I was talking about, the new father of the three-week-old baby, he said, I'm numb. He can't -- he can't get any thought in his head other than I don't want to put her down.

The woman who broke down -- who learned that her house was gone, she can't think about rebuilding. She simply is trying to stand up.

So, yes, you're absolutely right. They simply don't know how to feel and what to do.

STEVENS: And you mentioned food and water. Is there food and water getting to these evacuation camps, other parts of Sendai? I mean, is there power being restored? Or at the moment is all the focus on rescue?

LAH: Right now, the primary focus, governmental and military focus is rescue. We can hear the choppers up above us. We're starting to lose daylight. Daylight is almost gone.

But we can still hear the choppers in the air. There is still a heavy focus on search and rescue. And I have to say recovery. It's going to become much more a recovery effort as we're now passing the 72-hour mark.

But here in the evacuation centers, this is a community effort. And so what we're seeing is, yes, there is food and water because the community is pulling together. There's not electricity. None of these homes have electricity. There are some generators powering some of the rooms of this particular evacuation center.

So food and water is scarce, but they are starting to come into these evacuation centers. If you go -- for the people who actually live in the city where there is no power and water, or hot water, they have to stand in line at some of the stores. Some of the stores are distributing -- are selling the food and water, dry food and water, but they're limiting how much you can buy.

You can buy maybe a couple of bottles of water and rice or you can buy some potato chips and some water. So it's very limited rations across the board.

The one thing I will say, too, is that something that's really spectacular, especially if you're a westerner, is the amount of order and care that the Japanese have for one another, even in the face of this massive disaster. Lines are very orderly. Even people here in the emergency centers, they are helping each other, helping each other stand up, making sure that everybody is fed, and everybody has enough water. Even if they have to give up something, they want to make sure the community is able to keep moving on.

STEVENS: It sort of alludes to what the Japanese Prime Minister Naoto Kan was saying yesterday about getting closer to your family, getting closer to your community, so together they can survive this enormous disaster. Kyung Lah there joining us from an evacuation center in Sendai. Thanks very much for that.

As we keep on saying, the magnitude of this disaster, particularly the human side of this, is just enormous. It's not just human, though. There is a financial impact as well. We'll take a look at that next.


HODSON: Well, it's 5:14 in the afternoon in Tokyo. And thousands of commuters will shortly be leaving work. Travel is tough, even in the capital, far away from the epicenter of the earthquake. These pictures show you what Shinjuku station was like during the morning hour, a very, very, important hub there in Tokyo.

There was no train service so consumers were advised to take buses or taxis or just walk.

Welcome back from CNN Hong Kong and CNN London. You're watching CNN's special coverage of the earthquake in Japan. Andrew?

STEVENS: Charles, let's take a look at what has been the impact on the financial markets from the disaster. You remember that the tsunami -- or the earthquake and the tsunami struck just a few minutes before the Tokyo market closed on Friday. This is how it traded today, not surprisingly down sharply, perhaps a little more sharply than some had expected. That 6.2 percent, that's the single-day biggest decline in two years. You have to go back to the collapse of Lehman, the dark days of the global financial crisis to see falls of this magnitude.

Remember, this is the second biggest market in the world. Now, the big losers today, there were many across the board. There are some notable exceptions, but the big losers Toshiba Corporation. They are a maker of nuclear reactors. So not surprising that investors bailing out of that one.

Tokio Marine Holdings, this is an insurance company, Tokyo Electric, they are the operators and the managers of the Fukushima nuclear power plants, 23 percent down there. Tokyo Electric certainly a big hit there.

Now, in the auto sector, three of the key car makers all down again sharply, Toyota, Nissan, and Honda. Honda and Nissan and Toyota saying they will have to curtail their production. Toyota, in particular, has actually closed its total manufacturing capacity in Japan for the next three days. It will -- it is expected to open on Thursday morning. So the knock on effect of that closure, it affects about 40,000 units, but the knock on to earnings will certainly be an impact. That's what you're seeing there.

Take a look at construction. This is what I was saying about notable exceptions. This obviously is in response to what is going to be an enormous rebuilding plan for Japan, for that hard-hit area of the northeast and part of the country. Taisei and Kajima Corporation both soaring. Kajima known for constructing quake resistant buildings. It certainly led the gains for all the Japanese construction stocks.

Interestingly, it wasn't just Japanese construction stocks. Construction stocks rallying in Korea as well. But back in Japan, on the wider economic front, the Bank of Japan, the central bank there, saying that it was going to inject a record 183 billion dollars of cash into the financial system to make sure things are working smoothly, to make sure confidence is maintained, to make sure there's plenty of lending between the banks, which is a very important part of the financial markets, and also plenty of lending for consumers, should they wish to, to try to restore -- maintain some form of confidence.

Another confidence booster, Standard and Poors, the credit rating agency says that the quake will not have an immediate effect on Japan's AA sovereign debt rating. That's despite the obvious fiscal and economic impact we're only just starting to add up.

Certainly there's a lot of fears because Japan has such a high national depth. To pay for the restructuring will push that national debt even higher. But Standard and Poors saying, at this stage, it is not a big issue right on their radar screen.

Finally on the Yen, 82.09, it did gain in value sharply against the U.S. dollar in the direct aftermath, but it has come back down, helped by that that liquidity injection. Charles?

HODSON: Well, let's have a look at the longer-term prospects for Japan and how long it might take the world's third largest economy, as it is now, to return to some semblance to normality.

To do that I'm joined by Jesper Koll, who is head of Japan Equity Research at JP Morgan. And he's live from our Tokyo bureau.

Clearly the human cost is enormous, but in terms of the economic costs, Jesper, this was already a weak Japan that was struck by the earthquake, was it not?

JESPER KOLL, J.P. MORGAN: It's quite interesting, because, actually, the projectile was actually quite positive here. The good news is, from an economic perspective, that the range affected is actually not that significant. You know, the region there is about seven percent of Japan's output.

You know, so it's not as large as, for example, we had in '95 when the Kobe area was affected, which was about 15 percent of GDP. So from an economic perspective, you know, there are going to be some disruptions. But it's not going to be quite as big.

The key focus is the rebuilding.

STEVENS: Well, the rebuilding, we've already seen how those construction stocks are soaring. But what about the impact on the retail economy? I mean, are we likely to see some sort of short-term boost, not only in the construction sector, but also in the retails sectors? For example, people stock up with emergency supplies?

KOLL: No, you've got all of that stuff going on. You know, but I mean the key issue is -- and this is something that, you know, the government really needs to be applauded for. The policy response has been extraordinary.

I mean, Charles, you remember for the last 15 years we sort of accused Japan of doing too little too late. That is not the case this time around. The crisis has really galvanized policy makers.

You saw today the bank of Japan not just pumping up short-term liquidity, but stepping up the asset purchase programs. They're going to buy more weeds. They're going to intervene directly in the equity market.

I mean, this is very good. And you're going to get more fiscal support with the crisis actually uniting the government and getting us a supplementary budget probably in the next couple of days.

STEVENS: OK. Well, given that fiscal response, that policy response, do you think that Japan has headed off the possibility which -- for example, I'm reading some research here in London which suggests this -- the possibility of a return to recession, at least in the short-term, for Japan. In other words, a second quarter of negative growth?

KOLL: Well, I think that that's very unlikely. I mean, you know, we know that the January to February data was very strong. So, you know, the chances of the first quarter actually being negative is quite low. But that's all beside the point.

The question is does Japan have the financial wherewithal to do the rebuilding and to start the rebuilding quickly. And both the private corporations have got record cash balances and the public operations, you know, which have record low interest rates for their funding. You know, it's a green light for the rebuilding here.

STEVENS: OK. Jesper Koll from JP Morgan joining us live from Tokyo. Many thanks.

Let's swing back to Europe now. Stock markets have been open now for about 21 and a half minutes. Let's have a look at where they stand at the moment in terms of the main indices. We were looking at a sell off in terms of the futures market.

Let's have a look and see where we are right now. That has indeed come to pass with the Paris CAC 40 off by about half a percent. The one that's really taking it on the chin is the Xetra Dax, off by 1.5 percent. Zurich SMI lower by about three quarters of a percent.

Remember, insurance companies are important in Switzerland, although a lot of the earthquake insurance is borne by the government of Japan. And on the FTSE, we're looking at losses of about an eighth of a percent.

Now the U.S. markets still set for a lower open when trading begins later on Monday. U.S. futures stand roughly here in the pre- market action, looking to throw away the gains that they got on Friday of about half a percent, and despite the fact that that news obviously of the earthquake was out there all the way through the U.S. trading session.

So losses of up to nearly one percent for the Nasdaq Composite, half a percent for the Dow and the S&P 500. Andrew?

STEVENS: Charles, our continue coverage of the disaster in Japan will carry on in just a moment. We're going to take a shot break. We'll also be updating news from around the world as well. We'll be seeing how Japan's natural disasters emptied the country's abundant supermarkets. Stay with us.


HODSON: Welcome back. You're watching CNN's continuing coverage of the earthquake in Japan.

STEVENS: Well, let's recap the latest developments in Japan for you now. Aftershocks continue to rattle the country. The Japanese government says there's a high likelihood the country will experience a 7.0 or even higher aftershock in the next three days.

Just in the last couple of hours, there's been reports that Nagano has detected a 6.0 magnitude quake. And Nagano is much closer to the west coast than it is to the quake-hit east coast.

Meanwhile, a new hydrogen blast has injured six people at Japan's Fukushima Daiichi nuclear plant. The explosion was in the building that houses the plant's number three reactor. That reactor has been shut down. Government officials say the reactor has not been damaged.

The official death toll from the quake and the tsunami now stands at more than 1,600 people; 1,700 people remaining. Those numbers are, though, expected to go sharply higher as rescuers get to towns which still haven't -- haven't been seen by rescuers or anyone looking for survivors at this stage.


HODSON: In other news, Libya's rebels suffer another apparent defeat, as forces loyal to Libyan leader Moammar Gadhafi say they have retaken the opposition held town of Al Brega. The rebels admit they have been forced to retreat.

Pro-Gadhafi fighters have been trying to recapture town from the rebels since the uprising began last month. Meanwhile moving east, protests and violent clashes in Bahrain over the weekend. You're looking at video of what appears to be tear gas being used to disperse anti-government demonstrators. CNN cannot confirm the video's authenticity. Clashes also broke out at Bahrain University between protesters and supporters of the Gulf kingdom's rulers.

Clashes between supporters of Ivory Coast's two presidential rivals have forced more people from their homes. Rebels who support the internationally recognized president Alassane Ouattara say they've taken over another town. Alassane's backers managed to push back forces loyal to self-declared President Laurent Gbagbo on Saturday. Gbagbo loyalists attacked a suburb of Abidjan.

As Japan contends with the disaster, stories of surprise and sheer grit amid the total devastation. That's coming up.



UNIDENTIFIED MALE (through translator): I thought I was dying when I was pushed into the water.

But my thoughts were focused on my family, I decided to make every effort to survive.


STEVENS: Just another of the wrenching tales from survivors of Japan's earthquake. Welcome back. I'm Andrew Stevens at CNN Hong Kong.

HODSON: And from CNN London, I'm Charles Hodson. Welcome to CNN's special coverage.

STEVENS: A Japanese government official now says the cooling system of the reactor at the Daiichi Nuclear Power Plant in Fukushima has stopped working. The official says it shut down early this afternoon and the pressure has been building inside the reactor since. Now, this is the third reactor now that's facing danger at that plant in the wake of Friday's massive earthquake and tsunami.

Meanwhile, the official death toll from the disaster is now more than 1,600 people. But Kyoto News Agency is reporting that as many as 2,000 bodies have been found in Miyagi Prefecture. That is on the east coast of Japan, and the prefecture bore the brunt of the tsunami and the quake.

In one town alone, more than 9,000 people remain unaccounted for. One firm estimates the damage from the earthquake and the tsunami will total at least 100 billion dollars. You know, Charles, since then, I've seen estimates going up to 170 billion dollars.

HODSON: Yes. I think these are estimates. And good heavens, who knows, who knows. CNN's Stan Grant is in Tokyo. He has been following the latest developments at those two nuclear power plants that were damaged by the earthquake and the tsunami. He joins us live now.

Good afternoon to you, Stan. I mean, reading between the lines of what we're hearing, official -- and bearing in mind the fact that the Japanese authorities and the power companies have not always been wholly frank and up front with information, what do we really think is going on right now?

STAN GRANT, CNN INTERNATIONAL CORRESPONDENT: Well, we can only go on what they've been telling us, Charles. They have actually been putting out a lot of statements. There's been a fairly constant flow of information throughout this.

The veracity of it, well, we can go on what they've been telling us, from where we're standing. What they say -- you'll have to bear with me. It can get a little bit confusing when we get into these numbers.

We're talking about three reactors at the Daiichi plant in Fukushima. Initially, the concern was with reactor one and reactor three. Now, there was talk of a strong possibility -- an assumption of a strong possibility of a meltdown in reactor one and the possibility, a little less, of a meltdown in reactor three.

Well, today we had this explosion in reactor three, a hydrogen explosion, a carbon copy to a similar explosion that happened in reactor one. As a result of that, now we bring another reactor into play and that's reactor number two. It's knocked out. That explosion knocked out the cooling system for two, also stopped the cooling process in one and three.

So now they a have a triple problem. They have cooling problems with reactors in all three of those places at the plant. So what they've been trying to do is to pump more seawater in there to try to cool those reactors. They've been able to start the seawater process called reactor two, but the other two, at this point, have not been able to come online.

All of this, Charles, raises a concern about radiation going into the atmosphere. They have admitted there have been various levels of radiation detected. But the government has stressed all along that they're not at a level that would be harmless to people.

But, of course, there's the 20 kilometer, 12 or 13 mile, exclusion zone where people have been evacuated from their homes, about 200,000 people. So the picture continues to change. And I think thank's where a lot of the uncertainty and the doubt comes in.

Each event, we get more information and that raises more uncertainty and then perhaps people bring their own fears to be on that as well. Charles?

HODSON: So it's imagined that surrounding these three reactors in which the cooling systems have failed and two of which -- one of which certainly has suffered an explosion, there is a 20-kilometer exclusion zone. I mean that's been -- the exclusion zone speaks volumes about what the government really thinks, doesn't it, as opposed to what they're saying?

GRANT: Yeah, the key here is this: they're assuming the worst and planning for the best. Now assuming the worst means that they assume that there has been this meltdown of the reactors in at least one and three. Assuming that, they then bring in this exclusion zone, so the people do not fall prey to the harmful affects of radiation.

What they're planning for is that the redundancy safety features of these reactors kick into gear. And if there is a meltdown or disintegration of the reactor, it doesn't escape into the atmosphere, it doesn't go into the ground. Remember, these reactors are housed in a building. There is also a containment vessel around that.

What they're hoping for and what they're planning for is that all those safety procedures work. In the meantime, you have to assume the worst. And that's what they have set these other measures in place. Charles?

HODSON: OK. Stan Grant joining us live there from Japan. And, of course, the impact on the energy sector is considerable. Rolling blackouts are already taking place, blackouts of industry and homes as a result of shortage of electricity.

Well, explaining that a meltdown is partial likely does little to calm nervous evacuees. Twenty kilometer exclusion zone, that's a lot of people. Take a listen to what they're saying about the situation.


UNIDENTIFIED FEMALE (through translator): I'm deeply worried. I want to know exactly what's going on at the nuclear plant. I'm scared.

UNIDENTIFIED MALE (through translator): I don't understand the technical side of it at all, but I'm scared because I can see the radiation.


HODSON: Well, there are some measures people can take to protect themselves against radiation. CNN's Dr. Sanjay Gupta explains now why taking iodine tablets could help.


DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT: One of the big concerns is that the thyroid gland in particular can take up this radioactive iodine. So this is sort of a simple yet important concept, is that if you get a stable iodine, in this case potassium iodine, you're sort of flooding the thyroid gland with this stable component.

Even if there is an exposure to this radioactive element, it doesn't get taken up by the thyroid, because the thyroid's all full of normal, stable iodine. That's sort of the theory here. It seems to work pretty well. It's just simple iodine tablets, potassium iodine tablets.

Now, that's not going to work after someone has already been exposed. That's not going to necessarily protect people against other affects of radiation poisoning. And that's not going to obviously protect them against some of the acute effects, the nausea, the vomiting, the skin changes, the effects on the bone marrow.

But again, this is something that seems to be pretty effective against one of the most disastrous potential complications due to radiation.


HODSON: Well, at one medical facility in Fukushima, around one in five people being tested for high radiation levels are being referred to a hospital for further testing. Andrew?

STEVENS: Now, Charles, our correspondents on the ground say that many of the survivors they speak to are still in a state of shock, unsurprisingly. Even though the episode comes as a threat of a big earthquake, it was something many of them have actually lived with all their lives.

Now that this actually happened, those who lived with it are struggling to pick up the pieces. Anna Coren now reports from one town where grim reality has found a home amid the rubble.


ANNA COREN, CNN INTERNATIONAL CORRESPONDENT: We just arrived on the outskirts of Isinumaki (ph), which is just about an hour north of Sendai. We've teamed up with the Japanese military. And they're going through this neighborhood to see if they can find any survivors.

(voice-over): But it quickly became apparent this wasn't a search and rescue operation. They were here to recover bodies. This neighborhood, just 500 meters from the coast, caught the full force of the devastating tsunami. Every single home was damaged by the ten- meter wall of water, most beyond repair.

This man scrambled on top of his house, holding on to the roof for dear life.

(on camera): You are very lucky to be alive.

UNIDENTIFIED MALE: I'm lucky. Very lucky.

COREN (voice-over): There was less than 30 minutes between the quake hitting and the monster wave devouring the coast.

(on camera): This is your house.

(voice-over): Duro Chiba (ph) managed to drive out just in time, but says his neighbors weren't so lucky. (on camera): This is a scene of complete and utter devastation. The power of the tsunami, it just speaks for itself. The wall of water that roared through here within seconds collected everything in its path. And from the rescue workers that we have spoken to, the bodies that they are retrieving are those of the elderly people who could not get out in time.

Now, for the survivors who are returning to see what is left of their homes, when you stand here and witness the devastation, you have to wonder where these people start to rebuild their lives.

Anna Coren, CNN, Isinumaki, Japan.


HODSON: Well, Japan's nuclear crisis is affecting the whole country. When we come back, how a nation trying to recover now has to contend with darkness.


STEVENS: These are pictures taken in the port of Sendai. That was shot earlier this day. And you can see there the magnitude of the damage, hundreds of those ruined shipping containers being pushed up against each other, tossed into piles basically just by the strength of Friday's tsunami. Extraordinary pictures there.

Welcome back to CNN's continuing coverage of the aftermath of the 8.9 quake and the devastating tsunami that followed out in Japan.

HODSON: Well, let's take stock of the damage to Japan's infrastructure from the devastating earthquake and ensuing tsunami. Of course, the full extent of the damage is very far from clear. Early estimates suggest losses from the quake, coupled with the cleanup and repairs, could top 100 billion dollars. And that would make it the most expensive earthquake in history.

But Andrew, you were quoting numbers which were much higher than that.

STEVENS: Yeah, I've been reading endless reports coming out of Japan, Charles. Some are talking as high as 170 billion dollars. It really is difficult to put a clear estimate on this, obviously, until the full extent of the damage is known.

And speaking of the Red Cross, over the weekend, Charles, they were saying it could take a couple of weeks before the real impact is fully assessed, and certainly the number of missing people have all been accounted for.

But there has been an impact, as we've been talking about, in the financial markets, as well. The Nikkei is now closed for the trading day. But certainly it took a hit. It was down by more than six percent.

Insurance companies taking a pummeling, as well. That's certainly no surprise. Catastrophe risk modeling company AIR Worldwide says that Japan's disaster could turn out to be the insurance industry's most expensive yet. It says losses covered by insurance could reach 35 billion U.S. dollars. And that's before the costs of the tsunami are factored in.

Now, the estimate takes into consideration damage to homes and businesses as well as agricultural losses. If the loss prediction is accurate, the cost will surpass all other natural disasters, including the 2005 Hurricane Katrina and the 1995 earthquake in Kobe in Japan. Then losses were about 100 billion dollars, but insured losses came to just three billion dollars.

Meanwhile, food and fuel are in short supply across the earthquake zone. Transportation of consumer goods is hampered by torn up roadways, and people are reporting long waits to get into the supermarket. Once inside, there's very little available to buy.

No reports of any sort of looting. About 2.5 million households were without electricity on Sunday. That's just over four percent of the total number of homes in Japan. Rolling blackouts have now started in some areas, including the capital. That's part of a plan to save electricity. The Japanese Prime Minister Naoto Kan had this to say.


KAN: We could fall into power outage in a wide area. And sudden power failure could devastate the lives of people as well as to the industrial activities. And this is something that we must avoid.


STEVENS: Now, it's not only electricity in short supply. Japanese media reports at least 1.4 million, to be exact, households have no water. You're looking there at people standing in line to collect water in buckets. Workers say water shortages at some evacuation centers are creating unsanitary conditions.


HODSON: Well, as the future of nuclear energy in Japan remains uncertain, the price of natural gas is on the rise. To look at this in more detail, I'm joined by Emily Reuben.

Clearly the impact of this earthquake and tsunami on the nuclear industry, and by extension the energy situation in Japan has been quite fearful. I think that's the right word.

EMILY REUBEN, CNN INTERNATIONAL CORRESPONDENT: I think it's no underestimation to say that it's a huge impact on Japan's energy. Let's give you some figures now, because 35 percent of all Japan's energy needs are met by its nuclear power plants. And some of the electricity companies are building more of those.

They're building 14 more reactors, so that by 2020, they hope that 40 percent of all Japans energy needs will be met by nuclear. Now, of course, safety campaigners may get involved in the future of how nuclear energy is important to Japan, given what's happened.

As I'm sure you know, Japan is the world's largest importer of liquefied natural gas. Most analysts are saying that what they're missing in nuclear fuel they'll make up for buying increasing imports of energy.

HODSON: Presumably, the impact for global prices is going to be quite severe, then?

REUBEN: Well, the energy market is actually more -- it'll be able to absorb the shocks better than the oil market, because there's a lot of capacity. Qatar already said that they're going to boost supply. And I think what's going to happen is that prices have been depressed. They've been around the four dollar per unit mark.

But the impact could be felt higher in Europe, where stock prices are likely to increase.

HODSON: OK. What does experience teach us, if you like? Clearly the Kobe earthquake 16 years ago provides some kind of point of comparison for what's going on. And other situations where energy supply has been severely impacted. Are we likely to see a relatively rapid recovery and therefore the price of LNG coming down?

REUBEN: Charles, let me just talk about some figures here I've been given from Nomura. They say that 6.8 percent of industrial output has been affected by this earthquake and tsunami. That's actually less than what was affected by the Kobe earthquake in 1995.

However, output then fell minus 2.6 percent, but it was only a short term drop. However, what Nomura is saying is that the impact of this earthquake and tsunami are so much more devastating. So much more of the infrastructure has been destroyed that it's going to take an awful long time for Japan to be able to rebuild itself.

HODSON: OK. Emily Reuben, thank you very much, joining me here live in London.

Now, drying out after the tsunamis, facing the nuclear danger. And when we come back, the ever present threat of more quakes. The unremitting stress of aftershocks.


HODSON: Welcome back live from CNN Hong Kong and CNN London, you're watching CNN's special coverage of the Japanese earthquake and resulting tsunami.

STEVENS: Let's bring you up to date with the latest from Japan. And six people have been injured in a new explosion today in the northeast of the country. It was a hydrogen blast occurring at the building that houses the number three reactor at the Fukushima nuclear plant. This is where most of the crisis has been unfolding on this story.

Officials say the number three reactor was not damaged in that explosion today. And Japanese media are also quoting Japan's nuclear safety agency. They're saying the cooling system of reactor number two at the same plant stopped working early this day, and the pressure has been building up inside there. That means three of the six reactors at that plant are now experiencing severe problems.

Meanwhile, Kyoto news agency is reporting the discovery of 2,000 bodies at northern Japan's Miyagi Prefecture. Those bodies tragically add to the official quake and tsunami death toll. It currently stands at more than 1,600. It is widely expected to go much, much higher.


HODSON: Now, aftershocks continue to rock Japan. Our meteorologist Jill Brown is at the CNN Weather Center. I gather we're actually expecting one -- or some people are expecting one of up to seven on the scale, which is huge. And we've had one which is approaching that on the other side of Japan, right, Jill?

JILL BROWN, CNN METEOROLOGIST: That's correct. We've been seeing at least a small aftershock or two about every hour, at least since I've been here today. This is over on Nagano that we've had this, according to this Web site 5.4 on the Richter scale. So that -- not all of them have been in the exact same area. These are all considered aftershocks.

And every time we get a new one, it's put on the map in red. This is a live shot of the Web site. They could pop up at any time. After an hour, it goes to orange. After a day, it goes to yellow.

So you can see what's been going. And they've just been pelted one after another. So it just seems that they have no break. Almost every hour getting that feeling of yet another tremor out there. Although most of them have been in the four, five, six range, there's still the possibility that we could have some stronger ones. That is what's expected.

Since we had it well over 300 now. You can see how they've been clustered in the five to six. We've had a lot in the fours as well. Only one shortly after the major earthquake was over seven. We could still have another.

Here's the larger picture. And you can see as we zoom in that most of them have been clustered around that initial earthquake area. And we continue to se them. So well over 300 and more on the way, hour after hour.

We also have bad weather coming in. This is terrible news. We have had sunny and warm weather for the rescue efforts for the last couple of days, but now that's about to change. Already, the clouds have come in across Japan. And what's coming in with the clouds is a drop in temperatures.

So those southerly winds will go by the wayside. Up comes an area of low pressure from the south, initially will bring some rain in, we think for Tuesday. Behind it -- the cold weather comes in behind it. And while our normal average high this time of year is around nine, by Thursday, we're going to be maybe two or three degrees and with snow in the forecast.

So it looks like rain Tuesday and then rain/snow mix Wednesday, and then all snow and very cold temperatures for Thursday. So, Charles and Andrew, the worst news I could hear here. We don't have heat in most places. If they are lucky enough to have some shelter, it's going to be a cold night, but they probably won't have heat. And cold weather coming in.

Back to you.

HODSON: OK. Many thanks. Andrew?

STEVENS: Many thanks, indeed. That is it from Charles and I for this hour. You have been watching our special coverage of the disaster in Japan. I'm Andrew Stevens in Hong Kong.

HODSON: I'm Charles Hodson in London. CNN's coverage of that aftermath of the devastating earthquake in Japan continues after this short break.