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At near zero interest rates, the U.S. recovery from the subprime mortgage crisis of 2008 lacks luster. Pundits are particularly concerned with the depressed level of employment. Eschewing traditional monetary targets, the Federal Reserve vows to keep short-term interest rates near zero until the unemployment rate, currently 7.8 percent, falls below 6.5 percent of the labor force. A laudable goal politically no doubt, but otherwise very dubious in the sense that the Fed might further harm the financial system in pursuing it. For bringing savers and investors together, textbooks distinguish between direct and indirect finance. One downside of keeping interest rates so low is that financial intermediation— or indirect finance—throughout the U.S. economy is being undermined. When nonfinancial companies are fairly large so that their names are recognized and credit worthiness is fairly easily assessed, direct finance works well. Even in the U.S. economy’s current sluggish recovery the equity and bond markets are flourishing, although contracted interest rates are remarkably low. However, indirect finance— through banks and other financial intermediaries—is being squeezed out.