The myopia of Vancouver's mainstream media is astonishing given that 62.1% of 1,271 TSXV "resource" listings are headquarterd in British Columbia (read Vancouver) and spent about $900 million on "overhead" during their last reported fiscal year. What is even more shocking is that 453 BC headquartered resource listings have negative working capital totaling $960 million. It is impossible to tell how much of this is owed to BC based businesses, but, given the venture capital nature of TSXV resource listings one can with great confidence predict that these "receivables" will never be repaid in cash. It will be settled for paper at some random deemed market price, with a 4 month hold restriction. But before that the stock will be offered at half cents no bid, and by the time the debt settlement paper is free trading, management will have done a 10:1 or worse rollback that makes the stock offered at $0.05, with a rapid plunge to post-rollback half cent offered as creditors race to convert their settlement paper into cash. Once the debts have vanished the company will be available as a shell for a new venture, with most of the stock held by a core group of backers who put real money into the treasury at the minimum price. That is just the way things work in the venture capital game when things go sour.

But normally things go sour with a specific venture because for whatever reason it failed to deliver on its initial promise at new wealth creation. It is not normal for more than half of the system to go sour, and the remaining half appear to be in similar danger of going sour. This is the sign of a catastrophic collapse for the Canadian venture capital system. David Baines, the former Vancouver Sun reporter who specialized in shooting bad fish swimming in a barrel constructed by the system's gatekeepers, who for a while appeared possessed by a jihadi gene obsessed with overthrowing the dictates of Richard Dawkin's "selfish gene", must be rolling over in his retirement hammock.

The Darwinian decimation of the pollution sanctioned by the TSXV through its shell manufacturing system called "capital pools" and facilitated by the "boutique" brokerage firms now disappearing like may flies landing on the Bow River is not a bad thing. In a free market system a cyclical downturn flushes away all the poseurs, hangerons, and absolute stupidos. But the real issue is whether or not Canada has a role to play in funneling risk capital into public companies whose goal is to apply human ingenuity to capital to create new wealth. In terms of innovation Canada is not exactly a fountain of productivity, though in the arena of the resource sector it has excelled while the Americans forfeited. The failure of the Vancouver Sun to grasp that Canada's last claim to non-mediocrity is on the chopping block reflects an existential resignation that could prove useful to Donald Trump in undermining Ted Cruz's march toward the Republican presidential nomination. The Australians who are feeling the pain of the back-side of the super-cycle are chortling with delight about the self-inflicted demise of their chief competition.

The focus should be on the remaining 336 resource juniors headquartered in BC which have about $960 million working capital left as of their latest filings. Given the dearth of new equity financings, unless these juniors go into hibernation and thereby wipe out any remaining reason to care about Canadian resource juniors, the cupboard will be empty by the time 2017 rolls around. The TSXV White Paper offers a number of promising steps, but they are only baby steps which will lead nowhere unless Canada's regulatory establishment rebels against its banking establishment handlers and rejects their agenda of turning Canada into a Rocking Chair Nation.