> If interest rates soar and/or stocks plummet, the game is over:

A friend of mine is a loan manager at a very large bank. They do a massive amount of the real estate loans in the Chicagoland area. He said that if rates even rise to 6.5% for a home loan that about 90% of their current home loans wouldn't have a chance of qualifying. With the minor increases we have seen people are already starting to turn to adjustable loans to qualify.

If people aren't buying homes then their value plummet, no more using your house an an ATM (still happening at a crazy high rate), and foreclosures will once again become a massive issue. 

Forget the entire new home and remodeling industry. They get crushed if this happens as people can't get loans to buy or remodel.

Without construction all sort of other industries are effected that service the construction industry. 

This is just one small segment of the economy that once it starts to decline has a major ripple effect across the economy as a whole. 

Interest rates will rise and people need to be ready for what comes next.