War of the Rebellion: Serial 102 Page 1015 Chapter LX. CORRESPONDENCE, ETC. - UNION.

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NEW ORLEANS, LA., June 28, 1865.

(Received 30th.)

Lieutenant-General GRANT:

I have just returned from a hurried trip along the coast of Texas. The following is, to the best of my knowledge, the condition of affairs there: The Kirby Smith and General Canby surrender was for the most part a swindle on the part of Kirby Smith and Company, as all the Texas troops had disbanded or had been discharged and gone home before the commissioners were sent to General Canby. Kirby Smith, Magruder, Shelby, Slaughter, Walker, and others of military rank have gone to Mexico. Everything on wheels-artillery, horses, mules, &c. -have been run over into Mexico. Large and small bands of rebel soldiers and some citizens, amounting to about 2,000, have crossed the Rio Grande into Mexico, some allege with the intention of going to Sonora. The Lucy Gwin, a small steamer, was surrendered at Matagorda, but was carried off and is now anchored at Bagdad, on the Rio Grande. There is no doubt in my mind that the representatives of the Imperial Government along the Rio Grande have encouraged this wholesale plunder of property belonging to the United States Governments, and that it will only be given up when we go and take it. General Steele says that the French officers are very saucy and insulting to our people at Brownsville. Juarez does not appear to have any force of consequence on the Rio Grande. I cannot hear of any movements. The rebels who have gone to Mexico have sympathies with the Imperialists, and this feeling is undoubtedly reciprocated. I will direct General Steele to make a demand on the French authorities at Matamoras for a return of the property. The Lucy Gwin is a tangible case. A Mexican steamer loaded with cotton and flying the American flag was captured a few days since between Rio Grande City and Brownsville. After the surrender 826 bales of C. S. cotton stored at Rio Grande City was crossed into Mexico, and this is only one item. There is a good deal of irritation between French officials at Matamoras and our people, and the Maximilian party is getting nervous. My scouts report from Matamoras that 7,000 troops are marching from the interior to that place; also that Mejia is working on the rifle-pits around Matamoras. This reported re-enforcement I give for what it is worth.

P. H. SHERIDAN,

Major-General.

[Indorsement.]

HEADQUARTERS ARMIES OF THE UNITED STATES,

June 30, 1865.

This is respectfully referred to the President for his information. In my judgment, a demand should be made upon the authorities of Matamoras for all the arms and other Confederate property crossed over the Rio Grande after the surrender, with instructions to go and take them if they are not immediately given up.

U. G. GRANT,

Lieutenant-General.

SPECIAL ORDERS,

HDQRS. DEPARTMENT OF THE GULF, Numbers 172. New Orleans. La., June 28, 1865.

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8. In compliance with General Orders, Numbers 106, from War Department, Adjutant-General's Office, Brigadier General J. I. Gilbert, U. S. Volunt-