War of the Rebellion: Serial 041 Page 0717 Chapter XXXVIII. CORRESPONDENCE, ETC.-UNION.

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affairs of the Confederate States. They are reliable, so far as the information of the leading men at Mobile and in the State of Mississippi is concerned.

I have the honor to be, with much respect, your obedient servant,

N. P. BANKS,

Major-General, Commanding.

[Inclosure.]

A well-informed person, direct from Richmond, says that by the 1st of October six iron-clads leave England, one of them a very powerful vessel, carrying 1,400 men, and of a formidable armament. Their guns and officers are in France, and will be put aboard at a point off the coast agreed upon.

He says Jefferson Davis is broken and desponding, but braving it out; that the feels his wailing popularity, and is much affected by the desertions in the army.

Strong symptoms of disaffection manifested in the North Carolina regiments, and in that State especially.

Two thousand negroes are at work on the fortifications of Mobile. No soldiers there except city volunteers and militia. They rely entirely on Johnston's army.

Hardee has the command of the troops at Morton, Johnston devoting himself to the department generally.

Martial law very rigorous in Mobile and on our seaboard towns.

Confederate money rapidly depreciating there, at Richmond, and all along the route. People at Richmond saying of French army intervention, but the newspapers asking only recognition and rejecting all idea of armed intervention.

Report says that Alabama Legislature, now sitting, has recommended the immediate employment of negro troops.

Mr. Benjamin has very lately stated to a friend of mine that there would be peace in a fe months. He bases his calculation chiefly on the disappointment of the Western States in regard to the river trade, to political reaction, &c.

It has leaked out, likewise, that the late invasion of Pennsylvania was not a measure of Lee's or Davis', but had been insisted on by the Congress in recent session.

HEADQUARTERS DEFENSES OF NEW ORLEANS,

September 5, 1863.

Major General N. P. BANKS,

Commanding, &c.:

GENERAL: I have the honor to acknowledge the receipt of your letter of this date, informing me that General Grant will send a regiment of cavalry into this department for service with the expedition, and that he will also send a full division of infantry to New Orleans, for the purpose of occupation and defense of the city during the absence of the main body of the army, and that this division will be placed under my command, and at such point between this city and Port Hudson as may be necessary; and you desire an expression of my views in regard to landing the infantry division, as has been suggested, in the vicinity of Bayou Sara, and marching it thence by the rear of Port Hudson to Baton Rouge, at once sweeping off the guerrilla band in that neighborhood, and depriving them of military supplies, upon which they now subsist.