how negative interest rates affect different monetary balance sheet channel, i.e., the channels through which central bank actions have an effect on financial markets and the economy.

Explain the transmission channel and particularly how it operates in a negative interest rate environment. In particular, you should address these four questions:

1. Explain as clear as possible how the channel works in normal circumstances

2. What changes in a negative interest rate environment, and why?

3. Give a reason why it could become more effective

4. Give a reason why it could become less effective

You could keep it conceptual, or apply it to a specific case, like the situation in the Euro area or another country with a negative interest rate, like Switzerland