What's going on?

Chinese property developer Fantasia Holdings missed a $206 million debt payment early this week, and this party looks like it�s only just getting started.

What does this mean?

Evergrande might have been the main talking point of the last few weeks, but China�s crackdown on a debt-laden real estate sector was always going to have further-reaching consequences. Case in point: Chinese rating agencies have been downgrading property companies� bonds left, right, and center, suggesting they don�t think the firms in question are likely to make good on their debts.

They aren�t wrong: Fantasia � which was downgraded just last week � wasn�t able to settle its latest payment on Monday. The company quickly had to leap into damage control mode: it halted the trading of its shares on Tuesday to keep its stock price from falling even further than the 20% it’s dropped in the last month.

Why should I care?

For markets: There�s still hope for Evergrande.
Evergrande, meanwhile, has desperately been trying to sell off parts of its business in an effort to keep up with its payments on over $300 billion of debt. And there might be hope yet, with rival real estate company Hopson Development rumored to be interested in buying a majority stake in Evergrande�s property services segment. That could give Evergrande enough cash to get back on its feet, and not a moment too soon: its share price has fallen 80% this year.

The bigger picture: The US is in the deep end too.
Chinese property developers aren�t the only ones staring down the barrel of bankruptcy: the US is close to hitting the limit on national debt it can rack up, and its government now has to agree to raise that �debt ceiling�. If it can�t get the votes it needs to do just that by October 18th, the US won�t be able to pay the interest on its debt, which would be disastrous for the world�s financial markets.