In escape from japan doomsday, capital takes flight - Exhibition Booth Display Manufacturer

"A lot of people tell me they are worried about nuclear radiation.People also tell me they are worried about an economic disaster inJapan," Kosaka says. Even if the outflow of funds remains a relative trickle, itchallenges the consensus that Japan will avoid a Greek-style debtcrisis because Japanese investors have shown a strong "home bias"and fund almost all of the government's $10 trillion in debt. Butthat could change if more Japanese become willing to plan a futureabroad. "At my age, I think a lot about having a family, and I also thinkabout living abroad," Miki Akutsu, a 28-year-old employee at anadvertising agency, said at a seminar on buying Malaysian realestate.

"If Japan's finances collapse, social order would collapse as well.That would be a tough environment to raise children." The Japanese have been buying real estate overseas in the past, butwhat has changed since last year's earthquake and the Fukushimanuclear crisis is that it is no longer the province of the rich andthe retired. Increasingly, the middle class and younger people are opening bankaccounts in Malaysia, New Zealand and Singapore to buy condominiumsand homes that they plan to rent out for a few years before theyeventually move in themselves. "Since November, I've helped around 25 people buy condominiums at adevelopment in Malaysia. I would classify only three of thesepeople as rich," Kosaka says, pointing to a spreadsheet on hisnotebook PC.

The name of his firm, Kuratabi, means to live and to travel.Business has picked up for Kosaka, who first moved to Malaysiapart-time five years ago. LOW COSTS, NICE WEATHER AND GROWTH Akutsu was one of 30 people who crammed into a small office inTokyo to hear Takeshi Uchimura, managing director of Asia NetworkResearch Sdn Bhd, explain how to obtain a Malaysian second-homevisa to buy real estate near Kuala Lumpur. The pitch is simple. The yen is strong and cost per square meter isabout a third of what you pay in Tokyo. You can also borrow from abank in Malaysia.

If you rent out and park that income in a Malaysian bank account,you will earn more than in zero-interest-rate Japan. And if you decide to relocate to Malaysia, the cost of living islow, international schools affordable, crime is low, the weather iswarm all year, the population is still young and there is morepotential for economic growth. Japan overtook Iran last year as the country that is applying mostfor Malaysian second-home visas. Japan also leads the pack as ofMarch this year, Malaysian Tourism Ministry data showed.

For many, nuclear radiation leaks at Fukushima served as a catalystto take another hard look at Japan's economic woes - massive publicdebt, an ageing population, low economic growth and deflation - andmade them seem more insurmountable than before. In the fourth quarter of last year, households poured 578 billionyen ($7.28 billion) into foreign securities, according to the Bankof Japan, the first outflow in two quarters. That may be a drop in an ocean compared with some $15 trillion inJapanese household savings, but could mark a shift in perceptionsabout relative risks and advantages of moving assets abroad asopposed to keeping them at home. "The government would be worrying about this the most because theywould lose tax revenue," said Masayuki Kichikawa, chief Japaneconomist at Bank of America Merrill Lynch in Tokyo.

"Flows out of the banking sector would mean banks have lesscapacity to invest in Japanese government debt, so we would seehigher yields." For now, capital is flowing both ways. Foreign ownership ofJapanese government debt has risen to 6.7 percent of outstandingdebt in December from a trough of 4.6 percent in early 2010 becausemany investors still see Japanese bonds as relatively safe. Theconcern is those flows can reverse quickly, driving up borrowingcosts. Yusuke Nozaki, chief executive of Nozaki Asset Management Inc whichspecializes in New Zealand properties, says interest in real estatearound Auckland has increased threefold since the March 2011earthquake. "Our business is experiencing explosive growth," Nozaki said in atelephone interview from Fukuoka, southern Japan, where his companyis based.

"In the past year and a half I've increased my staff threefold. Idon't expect this growth to slow." Since last year there has been a jump in inquiries from housewives,he says. The logic is they can take the kids and move abroad, evenif only temporarily, and the husband can join later. BOOM FOR GLOOM Sensing a growth market, publishers have ramped up their offeringof books telling readers exactly how to transfer their savings intoforeign currencies, open overseas bank accounts and buy property,often with alarmist titles warning of sovereign meltdown and a massexodus of personal assets.

To be sure, publications predicting doom and gloom for Japan havefeatured regularly in bookstores for decades. Sakkyo Komatsu, ascience-fiction writer, had a hit in 1973 with "Japan Sinks," anovel that tapped into the pessimism around the time of the firstoil shock with a plot that hinges on the efforts of Japanese toescape as the archipelago slips into the Pacific. The new wave of books is touching a raw nerve in a nation stillunsettled by the Fukushima crisis, publishers say, andadvertisements for such "how to" books grow more prominent witheach passing month. One book that went on sale about a month ago, called "Escape fromJapan," has been an instant hit for the publisher, Asa PublishingCo. About 40,000 copies have sold so far, some three times as much asAsa Publishing normally sells when it launches a new title.

Thepublishers expect sales to increase further and are consideringpublishing more books on the same subject. "Publishers have issued books before that talk about Japan's direeconomic situation, but these books are basically a bunch ofeconomists who pose a lot of questions about Japan's future butdon't offer any answers," said Yuiko Furukawa, an editor at AsaPublishing. "That leaves people asking themselves what they should do. Wewanted to try to provide people with a practical guide for whatthey should do." ($1=79.4150 Japanese yen) (Editing by Tomasz Janowski and Jacqueline Wong).

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