There’s a serious disconnect between Wall Street and Main Street, says Peter F. Ricchiuti, a business professor at Tulane University, who’s warning against misinterpreting the stock market as a measure of the current economy.
Low interest rates and government bailouts have been catalysts for the incongruity. “Large corporations see a lot of room for improvement, and they like that,” Ricchiuti says. “Unfortunately, that’s not necessarily good for Main Street, and small companies can’t get access to the same capital or rates.” That’s resulted in thousands of bankruptcies, a situation aggravated by increases in COVID-19 cases, the lack of a new stimulus package and large-scale unemployment.
Ricchiuti gave the keynote speech during the virtual Louisiana International Trade Day on Nov. 4, hosted by the World Trade Center of New Orleans. The annual event focused on the historic and unprecedented challenges faced by regional businesses and trade professionals in 2020, and the evolution of creative new approaches to tackling those challenges. WTCNO is comprised of Louisiana- and Gulf Coast-based businesses that span a diverse set of industries and educational institutions.
Ricchiuti says while there will be some “permanent scars” that come out of 2020, they’re not all necessarily negative. “We’re going to have simpler supply chains,” he adds, “where a lot of materials come from sources closer to home, either domestically, Mexico or Canada.” He also expects lower “headcounts” in the typical work space, with remote working becoming the norm—not the exception. “It’s not a fad,” he adds. “A lot of us are never going back into the office.”