A central bank's weapons for stimulating the economy may become ineffective if short-term interest rates are "zero-bound," or hit zero. At least, that is the conventional wisdom, but the assumption has been tested in the recent past and found faulty.

In three recent cases, a central bank's action in pushing interest rates below zero seemed to have had modest success, or at least not worsened the situation. In all three cases, the action was a response to a financial crisis.