"Loose morals" is usually an euphemism for things to do with good ole' sex.....not crime or drugs or drunkenness. Your use of English seems to point to you being an American....and that is the colloquial usage of that phrase.
American views on sex and sexuality are greatly influenced by the dominance of Christianity in America, and a large part of that viewpoint by the Catholic Church and it's derivatives. Japan grew up as a non-Christian nation....and so did not develop the ingrained concepts of stuff like "original sin" directed toward sex like Christian nations tended to.
As has already been said, nudity, the human body, and sex are looked at in Japan as purely natural. As an example, you'll openly find "love hotels" all over the place so that couples can find some privacy. Japan also has a long history of open prostitution. While it is currently illegal...... you'll still find plenty of that stuff going on rather openly. (Just head over to Kabukicho for an example.)
And as also has been said..... Japan has one of the lowest if not THE lowest crime rates of any country. Violent and somewhat random street crime is almost unheard of. Guns on the street are rare indeed. And the drug laws there are amazingly harsh...... so illegal drugs are not common at all.
Drinking seems to be the second "national sport" after sumo!
Remember ... you take YOUR morals with you wherever you go.
best,
.................john