WASHINGTON, February 27, 1863.

Major General N. P. BANKS,

Commanding, &c., New Orleans:

GENERAL: Your letter of the 12th instant has been received and submitted to the Secretary of War.

River steamers cannot at this season be sent from here to New Orleans. The Navy Department has sent some additional vessels to Admiral Farragut, which must have arrived after the date of your letter.

The efficiency of the fort at Ship Island could, I think, be increased by wailing up the embrasures where the guns are not mounted and by preparing for musketry fire over the parapet. To take artillery to the island will only increase the temptation for attack by the enemy. The Navy at this time can afford you very little additional aid.

It is hoped that our operations up the river will be pushed with vigor. There is much dissatisfaction here at the delay, but probably the obstacles you have had to contend with the are not fully appreciated.

It is expected that the gunboats will be able to pass through the canal at Vicksburg by or before the 5th of March. But as this is uncertain and dependent upon the height of the water in the river your operations must not be delayed for those of General Grant.

The course pursued by you in regard to trade in cotton is approved.

Very respectfully, your obedient servant,

H. W. HALLECK,

General-in-Chief.

GENERAL ORDERS,
HDQRS. DEPT. OF THE GULF,19TH A. C., No. 21. New Orleans, March 7, 1863.

By General Orders, No. 8, published on the 12th day of January, 1863, it was declared that "all products of the country sent to the city of New Orleans in good faith might be sold by the owner or his factor for the legal currency of the United States without restriction or confiscation." Trade was then in the control of few persons and of small value. Under the influence of this order it has become of importance to the city and country. Honorable merchants, availing themselves of these and other advantages of the order, have complied with its restrictions. The evasions of other parties require its republication and strict execution. It is therefore ordered as follows:

I. "Products of the country sent to the city of New Orleans in good faith may be sold at market prices by the proprietors or their factors for the legal currency of the United States without restriction or confiscation."

II. United States Treasury notes having been made a legal tender in the payment of debts, except for duties at the custom-house, they will be received and paid out in all business transactions without discredit or depreciation; and whenever such notes are refused in the payment of any claim or debt such refusal shall be held and is hereby declared to be a discharge pro tanto of such debt or claim.

III. Any person who shall attempt, in the transaction of business, to discredit or depreciate the legal currency of the United States in favor of and to the advantage of any other paper currency shall forfeit to the use of the Government the merchandise which shall be made the basis of such transaction and his commercial privileges to the use of the people.

IV. All special deposits or contracts which are made or tend to exclude