China's evergrande crisis deepen files bankruptcy. US mortgage rates may rise to 8%.

China Evergrande, the colossal Chinese real estate conglomerate marred by massive debt, has thrust the world economy into turmoil with its Chapter 15 bankruptcy filing in a U.S. court. This strategic move seeks protection from creditors under the U.S. bankruptcy code, safeguarding the firm from litigation and asset encumbrance in the United States. Evergrande's staggering $330 billion liabilities have underscored the perilous state of China's property market, sparking concerns of a cascading impact on the broader economy. Over 40% of Chinese home sales firms have defaulted since the sector's debt crisis emerged in mid-2021. Country Garden, the country's largest private developer, is now raising alarm as missed interest payments heighten investor apprehension. Economists foresee a potential surge in mortgage rates to an alarming 8%, evoking memories of the Great Recession's aftermath. As rates linger above 7%, homeownership costs surge, leading to concerns about a steeper escalation. MarketWatch reports three analysts' consensus: if the economy remains robust and the U.S. Federal Reserve raises its benchmark interest rate, the rates could escalate to 8%. The housing sector has already experienced repercussions due to elevated rates, impacting home builders witnessing reduced buyer traffic. While early signals of economic cooling and easing inflation may offer a glimmer of hope for rate decline, the forecast remains uncertain. A recent surge in U.S. retail sales contradicts initial predictions.