to getting from the rebel lines the products of your district, especially cotton, turpentine, and tobacco. I think it would be best to receive all such products from any party desiring to dispose of the same, and to advance, either in goods or money, the amounts which you would be safe in doing, looking to the rise and fall of the markets while the property is in transitu to Norfolk or New York for sale, I would advise that you should use any money in your hands, the products of abandoned estates and property, for this purpose. By these means 25 per cent of the product would be saved the Government, the resources of the rebels would be in so far diminished, and I am assured that in so doing you would be carrying out what is the policy of the Government. I have directed General Palmer to give all aid and protection of the military forces to all persons bringing in the products of the country which are to be turned over to the Treasury. You can call upon the quartermaster to furnish you with such return transportation as he may have to aid you in this purpose, of course charging a proper freight to the merchandise, to be deducted in its account of sale, which amount is to paid to the Quartermaster's Department. Of course, it will occur to you at once that there must be some caution used in this matter, because, if it is known in the Confederacy that the Government is actually purchasing these products, it will cause a rise of the same in the Confederacy, and not give the point between the present price in the United States and in the Confederacy, where it belongs, either to the Government or to the loyal citizen who shall bring it in. Therefore, preferably loyal citizens should be allowed to bring in the products of the country to you. I would further suggest that, as a rise of prices in the Confederacy would be stimulated by an unrestrained trade by all parties who desires to get it out, that you keep control of the trade by means of your permits; and, although that may make it essentially a monopoly, yet it is a monopoly for the purpose of keeping down the prices in the Confederacy. These last suggestions will not apply, however, to a party actually raising, owning, and bringing in products, whether he is loyal or disloyal, but applies to those who come in as go-betweens from the producer to the Government as traders merely. I am quite certain that this course of action will be sustained by the Treasury, as I am prepared to say it will be by the military authorities.

I have the honor to be, very respectfully, your obedient servant,

BENJ. F. BUTLER,

Major-General, Commanding.

CITY POINT, VA., December 22, 1864.

Honorable EDWIN M. STANTON,

Secretary of War:

HEADQUARTERS ARMY OF THE JAMES,
December 22, 1864.

Lieutenant-General GRANT:

The Richmond Examiner of to-day says it was currently reported yesterday that two divisions of the enemy's cavalry had crossed the Blue Ridge, and were moving toward Madison Court-House.

LATER.- That Sheridan's infantry had come up the Valley to a point between Harrisonburg and New Market. His advance is supposed to be intended as a diversion in favor of the cavalry movement on this side of the mountains. Early has marched out to meet him. The mounted force which has crossed the mountain is 4,000 in numbers, and have four pieces of artillery. They were yesterday in Madison County.