https://www.northernminer.com/
Canada’s once-mighty junior mining sector crumbled after governments squeezed the middle class and let multinationals buy the country’s big miners, a panel of finance experts told mining’s biggest conference this week.
Large Canadian miners such as Falconbridge, Inco and Noranda (all gone by 2007) would use much as $200 million each a year to shepherd perhaps 100 junior level companies because they made half of the discoveries, Franco-Nevada (TSX: FNV; NYSE: FNV) co-founder Pierre Lassonde said on a panel at the Prospectors and Developers of Association of Canada convention in Toronto on Tuesday.
The industry’s poor performance and high interest rates that have made it easier for investors to make money with little risk are just parts of the equation, delegates heard. Retail investors, traditionally the biggest source of funding for juniors, have also disappeared. Lassonde tied the state of retail investing to high taxes.
“Back in the ’80s, the disposable income that the middle class had, it was far better than it is today with 54% maximum tax rate here in Ontario,” he said. “They would say, ‘I’ll take $1,000 or $2,000 and instead of going to Vegas, I’m just going to bet on a junior — it’s more fun and if there’s a discovery, I’m part of it.’ That group of people have been completely washed out by our government.”