For the last three years we’ve heard increasingly dire reports of the percentage of junior mining companies that have little or no cash. According to one recent report, about half of the junior mining companies out there have negative working capital. We keep hearing that a wave of bankruptcies is imminent and it’s going to devastate the sector. The Financial Post once warned that the pipeline of exploration projects would be choked off by the extinction of the junior mining sector—the problem is that this warning came almost two years ago, and the juniors struggle on. The concern is reasonable, but experience has made us wary of mistaking the inevitable for the imminent. Now the news is just out of junior miner Allied Nevada’s bankruptcy. The shockwave is sure to be felt across the sector because the company was once a market darling, shares of which soared from about $3 to over $43. This could be the beginning of a long-overdue housecleaning in the junior sector—which would be a good thing, in our view. Be that as it may, this is why we stress a healthy cash position in all our investments.