I must say (and I suppose I already did, once or twice) that the willingness to ignore the issues in the credit markets and assume that all will be well with the economy astonishes me.

The mortgage business, other than conforming loans, is more or less at a standstill. It will take a month or two to show up in the headline statistics, but early data is already becoming available. Picking on San Diego for the simple reason that that’s where the data are, Jim the Realtor reports that the indicator of market health he uses, the ratio of active listings to pending sales, is rising rapidly as sales come to a grinding halt. Calculated Risk shows that foreclosures are about to swamp regular sales activity.

Nationally, Reuters reports on the job losses in the mortgage industry as lenders and brokers shut down and disappear. The Mortgage Lender Implode-O-Meter now stands at 130. Bloomberg reports that the commercial paper marketplace has “seized up” for real estate and mortgage investment companies. I could go on, but the message is clear. It’s too late for real estate. Those high house prices? They’re history. A lot of people will be fine. But the loan window is closed for all except the folks with good credit, down payment or equity, and documented ability to pay.

The proceeds of an explosion of loans has fueled the economy for the last few years. The tank is empty. Just like that. Momentum and credit cards will carry the consumer a little way. But not far. Look out below.