Rooms suitable for officers' quarters cannot be procured in Houston, the permanent headquarters of the district, for less than $150 to $200 per room. My staff while there were forced to hire unfurnished rooms at that rate. In connection with the foregoing it is proper that I should lay before the commanding general some of the difficulties that meet me at every turn and out of which I can see no escape, to the end that if I should fail in accomplishing all that may be expected of me by the uninstructed, that the general commanding may at least not be of that number. As I have already mentioned, Confederate money, where it is received at all, is so lamentably depreciated that to purchase the necessary supplies for my small army at present rates would bankrupt the king's exchequer in a short time. The tax in kind and the law of impressment will, for some time to come, furnish us subsistence and forage, but, beyond this, not a pound of supplies can be purchased for Confederate money, and I am not provided with a dollar of specie and have no means of obtaining it. To purchase upon the credit of a government whose promises to pay are worth to this people but 2 cents on the dollar is of course out of the question, and unless some measures are adopted to restore Confederate currency to the standard of its value in the States east of the Mississippi River I cannot see how we are to maintain our army in this State beyond the coming winter.

The material difficulties that surround me here grow directly out of a fearfully depreciated currency, which has been mainly brought about by the cotton and beef trade with Mexico, by which the precious metals, to a limited extent, have found their way in the country. If a sufficiency of gold and silver could be introduced, through the foreign trade now going on with Mexico and Havana, to supply a circulating medium sufficient for the demands of domestic exchange the evils would be less felt, for then the Government could demand a portion of the Confederate States' taxes and other dues in specie and exclude Confederate notes from circulation. But, as it is, the amount of the precious metals in circulation is just sufficient to depreciate to a ruinous standard the currency of the Government, and is every way an unmitigated evil, for which I see mo remedy except the cutting off this trade entirely. This now would be a measure of no little difficulty. The trade which has been going on from San Antonio across the Rio Grande from an early period of the war is now being carried on from every portion of the State with the energy of avarice and appetite long held in abeyance. In addition to the material difficulties growing out of a depreciated currency, I am surrounded with moral ones, which, to some extent, have produced this depreciation-I mean the lukewarmness and distressing apathy of the people. As is well known, the most patriotic and reliable men are in the army, leaving at home, to mold public opinion and to prey upon the necessities of the defenseless, an army of speculators and extortioners. Even men who would resent being classed under this head, and who, at the beginning of the war, were fierce patriots, now share the general demoralization, and so lukewarm in the cause have the people become that but for the conscription and the impressment law not a man nor a pound of subsistence could be procured in the length and breadth of this State, and a majority of them would not turn upon their heels to save the Confederacy unless paid for it "in specie." In the manifold difficulties and embarrassments that surround me here I feel sure that I shall receive the support of the general commanding in all proper measures that I may find it necessary to adopt, and that since it is out of his power to furnish me even