For University of Michigan economics professor Miles Kimball, negative rates are both possible and inevitable.
Kimball has travelled the world talking about the effects of subzero rates with central bankers around the world—including Fed policymakers. His goal is to show policymakers that "it's actually really easy" to effectively make interest rates negative.
Moreover, he believes adding the tool to a central banking policy toolbox is critical to ending recessions and combating deflation.
"What I've been working on is trying to make sure that the intellectual foundation for negative interest rates is laid in time for the next recession," Kimball told CNBC in an interview. "It's important for people to realize that the zero lower bound is ultimately a policy choice, and it's a bad one. And it's something that come another big emergency, we can do away with."
The concept of negative rates can be thought of as such: if the equilibrium interest rate—the rate at which money would naturally be lent—is a percent per year, a central bank wanting to combat low prices could trim its target rate below 1 percent. That will cause excess money to be borrowed and invested, and hopefully boost inflation and growth.
Yet if the equilibrium interest rate is actually below 0 percent, then most holders of currency would rather suffer a guaranteed loss rather than lend their money out. This was prevalent during the depths of the Great Recession. In that case, even an interest rate of 0 percent would be contractionary rather than stimulative.
Former Fed chair Ben Bernanke's preferred solutions to this problem included purchasing bonds via quantitative easing (QE) and assuring Americans that rates would stay low for a very long time. Kimball, however, said the endeavor was doomed from the start.
"Maybe we should have done three times as much QE, but nobody knows what three times QE would have done. By contrast, negative interest rates is right there in standard theory," Kimball said, which means that we can predict its effects by using basic economic models and beliefs.
Kimball doesn't necessarily believe that negative rates would be appropriate in the U.S. given that the worst of the recession is over. However, the conditions may present themselves again within the next decade, and the Fed could be prepared to meet the challenge.
"By the next recession, the U.S. will be ready to employ negative interest rates," he predicted.
Although Yellen shot down the short-term potential for negative rates, she said last week that if "we found ourselves with a weak economy that needed additional stimulus, we would look at all of our available tools, and [a negative rate] would be something that we would evaluate in that kind of context."