There are lots of folk songs and ballads in minor keys.

Keith, tell your friend that if he thinks that, he should spend a little time actually listening to some folk music.

There are people out there (including a lot of musicians, who should know better) who think that "Down in the Valley" is the be-all and end-all of American folk music and that "Greensleeves" is the only English folk song there is (but, of course, according to any strict definition of "folk music," it doesn't qualify--and, by the way, it's in a minor key, and is harmonically fairly rich).

Don Firth