Cut and paste from another board:
"Re: Zero and Negative Interest Rates
From what we've seen and read, it would be bad. It could cause a bubble in asset prices. While that would be good for those who own financial assets (like most of us), you have to sell to book those profits, and then what do you put your proceeds in when everything is at bubble prices?
Second, it does little for the economy and actually keeps bloated debt-ridden businesses ongoing because they can keep rolling over their debt. This is deflationary because these weak businesses stay in business (cue forest fire analogy to scrub brush). Think about the e&p shale firms.
Third, how would banks make any money unless they took greater and greater risks? Eventually they get in trouble by extending credit to less creditworthy borrowers. Insurance companies and pension funds would also have difficulty earning their 8% required returns with no fixed income yielding that high, which could cause them to take on more risk by buying stock assets that are in a bubble.
Once you go down this path, it's near impossible to get back to normal. The ECB was never able to normalize rates. Our Fed couldn't normalize rates and they only went to 0% in the last crisis. Each time they attempt to normalize, it causes a huge selloff (see Dec 2018) and each time they need a another hit of the heroin, they will need greater and greater amounts. Everyone becomes Japan and eventually the Central Banks will end up owning all the stocks (see the Swiss Central Bank and the BOJ)."