On Wednesday, gold (NYSEARCA:GLD) futures for December delivery decreased $3.70 to settle at $1,611.90 per ounce, while silver (NYSEARCA:SLV) futures fell 30 cents to settle at $29.20.

The ECB provided 489 billion euros in three-year loans today, the most ever in a single operation, signaling that hundreds of banks foresee the need to hoard cash for a troubling 2012.  The ECB said 523 banks asked for the 489 billion euros in funds, which will be lent at the average of its benchmark interest rate — currently 1 percent — over the 1,134-day loan period.

Investor Insights: What Are ECB Actions and Utility Stocks Saying About Gold?

Barclays (NYSE:BCS) estimates that today’s operation will inject 193 billion euros of new money into the system, with 296 billion euros accounted for by maturing loans.  The loans amount to quantitative easing “through the backdoor,” said Simon Derrick, chief currency strategist at Bank of New York Mellon Corp. (NYSE:BK). “What the ECB is doing is providing ultra-cheap money to banks, which in turn are going to be in there buying the sovereign debt up,” Derrick told Bloomberg Television’s “First Look” earlier today.

The backdoor quantitative easing did little to improve confidence in the euro.  The euro fell while the U.S. dollar (NYSE:UUP) climbed higher.  As a result, several gold and silver names edged lower.  In afternoon trading, the SPDR Gold Trust (NYSEARCA:GLD) declined by .10 percent, while the iShares Silver Trust (NYSEARCA:SLV) fell 1.15 percent.  Gold miners (NYSEARCA:GDX) such as AngloGold Ashanti (NYSE:AU) and Barrick Gold (NYSE:ABX) fell 1.46 percent and .13 percent, respectively.  Silver miners (NYSEARCA:SIL) such as Hecla Mining (NYSE:HL) and Endeavour Silver (NYSE:EXK) both declined by .35 percent.

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