Is it time to rethink the direction of interest rates for 2016? Cheap oil and international concerns have unexpectedly turned a positive U.S. outlook into despair. Bond yields are lower across the curve, stocks have tanked, and the market’s mood has shifted from optimism to pessimism. What was thought to be a solid pick-up in consumer spending, strong employment, muted inflation aided by low commodity prices, and respectable corporate earnings have disappointed. The financial markets are starting to think that auto sales (a strong performer for the past 2 years) may have come and gone. The December economic data is suggesting a 2016 slowdown for the auto industry as evidenced by a .1% drop in retail sales, a decline in industrial production, PPI negative by the most in 5 years, and a really ugly stock market. Equities are down almost 10% since the beginning of the year and investors are seeking safety in UST bonds. The wave of selling in stocks is being driven by crude oil crashing below $30 per barrel and China’s slumping economy. Our bond yields remain attractive as compared to like maturities of other industrialized nations. Hopefully, we return to normal after the MLK holiday and perhaps the Fed will see wisdom in staying quiet.