So let’s tally the tea leaves. First, some good news:

• The stock market is a notoriously unreliable recession predictor. As economist Paul Samuelson once famously quipped, the markets have “predicted nine of the last five recessions.”

• The fundamentals of the U.S. economy are good. It’s not just that U.S. employers added 292,000 jobs in December – that’s a lagging indicator – but rather that evidence of “overheating” in wage growth or consumer prices is barely existent.

• The world’s second largest economy may be in serious trouble, but its impact on the U.S. is still small. U.S. exports to China last year were less than 1% of GDP.

The bad news?

• The expansion is getting old – six and a half years. The average expansion since World War II lasted less than five years. In recent times, they’ve been longer, but the last three still averaged less than eight years.

• The economics of oil in the U.S. have reversed. Not long ago, rising oil prices caused recessions. But Donald Luskin argues that this time, falling oil prices may precipitate the recession. A Morgan Stanley analyst says oil prices could fall as low as $20 a barrel.

• Despite our low exports, the impact of China in the global economy is larger than ever before. As a result, says former Treasury Secretary Lawrence Summers, the “global risk to domestic economic performance in the U.S., Europe and many emerging markets is as great as at any time I can remember.”

Economists like to say economic expansions don’t die of old age, but are killed by bad policy. If you believe that, there’s reason to be optimistic. The likelihood that Fed Chief Janet Yellen, a notorious dove, will raise interest rates too rapidly this year are small.

But if history is your guide, it’s time to prepare. The odds of a recession in 2016 may be less than 50%, but not by much. And in 2017, the odds shift.

More news below.

Top News

• China's stocks fall again, Euro markets stable

China's stock market turmoil continued into a second week, as the country's markets finished Monday trading down more than 5% on concerns over a struggling economy while global oil prices also continued their slide. However, unlike last week when China's market troubles triggered a worldwide stock selloff, European markets actually staged a modest rally to start the new week. The FTSE 100 began the day up slightly, while Germany's DAX had gained more than 0.5%. Nobel Prize-winning economist Joseph Stiglitz said over the weekend that China does not face a "cataclysmic" collapse, but rather has struggled with poorly-designed stock "circuit breakers." Bloomberg

• Tesla restricts autopilot despite Musk's praise

Tesla Motors said this weekend that it will limit the autopilot function on its Model S electric vehicles in order to reduce their speed in certain driving environments, including on residential streets. The announcement came at an industry auto show in Detroit, where CEO Elon Musk added that the much-anticipated autopilot function is still in beta mode and he has yet to hear of any accidents caused by the software despite some early users posting YouTube videos showing some seemingly dangerous situations. Still, Musk says the function, which also allows cars to park themselves, is "probably better than human" drivers. Reuters

• Kohl's weighing drastic actions as shares slump

Fortune has written quite a bit about the attempts by department store operator Kohl's to navigate a turnaround at a time when many of its rivals are struggling to post meaningful sales growth. But, despite a small rise in same-store sales in its last quarter, the 1,200-store chain's shares are still down nearly 40% since last April's all-time high. Now, Kohl's is reportedly considering taking some drastic steps to promote growth, including possibly taking itself private or even breaking up the company.  Wall Street Journal (subscription required)

• Clinton, Trump leads in question after new poll

Hillary Clinton and Donald Trump may be widely seen as the frontrunners in their respective parties' primary races, but a new poll suggests the candidates' leads may not be as safe as was once thought. Trump, the firebrand GOP candidate who has built a surprising lead in the polls, still holds a strong lead in New Hampshire, but Senator Ted Cruz has the advantage in Iowa, according to a new NBC News/Marist poll released on Sunday. Meanwhile, Clinton still leads the Dems in Iowa, but Senator Bernie Sanders now has a four-point lead in New Hampshire.  Fortune

Around the Water Cooler

• Wall Street's profits recession

Fourth-quarter earnings are beginning to trickle out, with a handful of major banks due to report their latest quarterly numbers this week. Unfortunately, what those earnings may reveal is that, while the U.S. economy is looking solid, corporate profits may be suffering through a recession. Energy and materials companies are the most likely culprits to lead an earnings recession, which equals two-straight quarters of declining profits, but consumer-based stocks could make that recession even worse as those companies are expected to show fourth-quarter growth that falls below the pace expected by Wall Street. One thing that bodes poorly for corporate profits is that a high number of consumer discretionary companies have given negative forecasts for the fourth quarter.  Reuters

• Should you buy Apple stock?

Apple's plummeting stock has many investors wondering if now is the perfect time to buy the tech giant's shares at bargain-basement prices. Apple's shares have lost 28% of their value since hitting an all-time peak last April and the company's price-to-earning ratio of 10.5 is low enough to suggest sluggish growth, at best. But, Fortune's Shawn Tully argues that, with smartphone sales sinking, Apple has a tall order ahead in needing to find a "new iPhone"—or, a product so successful that it can sustain similarly impressive profit returns—so the company is "not the screaming buy" some investors hope it to be.  Fortune

• The Supreme Court could deal a blow to public unions

Today, the U.S. Supreme Court will hear oral arguments in Friedrichs v. California Teachers Association—a case with the potential to disrupt how public unions are able to collect dues from non-union members they represent. The case, brought by a group of teachers and an advocacy group, takes aim at a three-decades-old Supreme Court decision that allows public unions to charge non-member public employees certain fees for negotiation on their behalf. The teachers are arguing that non-members should be able to opt out of paying dues because the union's collective bargaining amounts to political activity, which is not allowed under the precedent.  Fortune

5 things to know this week

Stocks, Obama, and December retail sales—5 things to watch for in the week ahead. This week's story can be found here.