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An earthquake of historic magnitude hit Japan this morning, centered off the coast of Sendai. All we know so far is that it caused substantial damage in many cities, including Tokyo. The quake also caused at least one, and possibly several, tsunami waves, which has caused even more damage to coastal areas and which could hit areas all around the Pacific today. Lives have been lost, and we extend our sympathies to everyone in Japan and elsewhere who has been affected by this natural disaster.

Anyone who tells you that they have a handle on the economic consequences of this event is wrong. There is no way to assess even the direct damage to Japan’s economy, or to the global economy, that this will cause. Some idiot told a reporter the percentage of Japan’s GDP that was generated by Sendai’s economy, and the teen-aged scribbler then published that number as an indicator of the economic risk. We do not know what we do not know about the damage that has been done. Experience tells us that the economic shock can be, and likely will be, much bigger than anyone can imagine.

For instance, the Bank of Japan was quick to report that its clearing systems are intact, and that it was able to settle all the transactions between banks at the end of business last night. That is good for banks, but millions of people are going to need a lot of cash, and bank branches are not going to be open in a lot of places. A lot of households and small businesses that conduct financial transactions electronically are not going to be able to conduct those transactions because their houses or businesses are gone. That will impact the people and businesses to whom money is owed, regardless of where that may be… in Japan or in New York City. Obviously, insurance companies are going to be hit hard, and they invest everywhere. Businesses, banks and individuals in Japan who have invested money in stocks and bonds everywhere in the world are suddenly going to need liquidity, and maybe a lot of it: The currency market has already started speculation about a rush of repatriation of funds by locals, and the demand for yen that will generate.

As for the economy… well, who knows? Cities, factories, infrastructure, farmland… we already have graphic images of a lot of damage in a lot of places, although we cannot judge the true extent of it. Photojournalists point their lenses only at the parts of the world that are broken-they have no interest in telling us how much of the overall picture has been captured in their images. If a tsunami has wrought substantial damage to the coastal areas, that is where the ports are. Through those ports go all the exports made all around Japan, not just in the quake-affected areas. Also, the crude oil that makes Japan run comes through those ports. So do industrial raw materials for industries all around Japan. So, too, do all the hundreds of millions of fish that feed all those people every day… that is, if people can get cash to pay for food. Airports are closed, too, and that will cost the economy a pretty penny.

So we do not know what we do not know. All we know is that a tragedy has occurred, and the initial reports suggest its implications for the economy will be big. This is a sad day for Japan, and economic aftershocks could affect the whole world’s economic well-being. After all, Japan’s is still the third-biggest national economy on the planet and the fourth-biggest trader.

In an absence of hard facts, worried investors are scurrying into safe bonds this morning-not Greek or Irish or Portuguese bonds-and U.S. dollars. The yen is getting a bid on the repatriation trade. Globally, stocks are doing poorly because of all the uncertainties we outline above, and because of the risks we have not yet thought of. The quake hit Tokyo half an hour before closing, so the market only had time to fall from around 10,370 to 10,254. There are sure to be more losses on Monday when the market re-opens… if the market is indeed allowed to re-open on Monday.

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