At the same time, it is sometimes the case that the stimulus provided by lowering the policy rate is less effective in a financial crisis because important parts of the policy transmission mechanism are dysfunctional. This difficulty was highlighted in the current crisis where the financial difficulties centered on housing, which is typically a key component of the transmission mechanism.
And, it was even more dramatically illustrated in the Japanese banking crisis a few years ago where monetary policy was pushed to its limits with very little effect. As I have indicated on other occasions, care must be taken not to ask too much of monetary policy or we risk adding significant inflationary pressures into an economy.