Central Banks Step In; Gold, Silver Step Down

The spot price of gold was dropping fast early Thursday as the European Central
Bank along with the help of the U.S. Federal Reserve, the Bank of England, the
Bank of Japan and the Swiss National Bank announced it would provide as many
dollars as banks needed to avoid a year-end funding crunch. Spot gold was
trading at $1,778.90 Bid, $1,779.90 Ask, down from a high of $1,802.90 and off a
low thus far of $1,774. Spot gold was fixed at $1,782 in the London p.m. Spot
silver was bid at $39.67 with an ask price of $39.77, down from a morning high
of $40.47 and off a morning low of $39.48. Spot silver was fixed at $40.34 in
the London a.m., according to Kitco market data . The ECB announced it would
hold three fixed-rate money market operations between October and December,
during which it would offer banks all the dollars they needed to meet their
year-end funding needs and avoid a liquidity crisis. The U.S., U.K., Japanese
and Swiss central banks said they would support the program. On the exchanges,
gold and silver trusts were sharply lower. The SPDR Gold Trust (NYSE: GLD ) was
moving about 2.4% lower. The iShares Gold Trust (NYSE: IAU ) was down around
2.4%. The iShares Silver Trust (NYSE: SLV ) was around 2.9% lower. Gold and
silver mining ETFs were moving sharply lower for a fourth consecutive morning.
The Market Vectors Gold Miners ETF (NYSE: GDX ) was around 2.6% lower. The
Market Vector Junior Gold Miners ETF (NYSE: GDXJ ) was down some 2.9%. The
Global X Silver Miners ETF (NYSE: SIL ) was around 2.5% lower. Shares of gold
miners were down, with NovaGold Resources dropping more than 5%. Agnico Eagle
Mines (USA) (NYSE: AEM ) was nearly 3.5% lower. Barrick Gold Corp. (NYSE: ABX )
was around 1.4% lower. Goldcorp (NYSE: GG ) was showing losses of 2.85%. Newmont
Mining Corp. (NYSE: NEM ) was down nearly 1.9%. NovaGold Resources (USA) (AMEX:
NG ) was more than 5.6% lower. Silver mining shares were moving sharply lower,
with Coeur DAlene Mines plunging. Coeur DAlene Mines Corp. (NYSE: CDE ) was
around 6% lower. Hecla Mining (NYSE: HL ) was down 4.7%. Pan American Silver
Corp. (USA) (NASDAQ: PAAS ) was more than 3% lower. Silver Wheaton Corp. (USA)
(NYSE: SLW ) was down 2.25%. Silver Standard Resources Inc. (USA) (NASDAQ: SSRI
) was around 3.4% lower. The author does not hold positions in any of the
above-mentioned investments.