But the sale and disposition of these large amounts of unserviceable and perishable stores still leave on hand and adequate supply of war material to meet any emergency that can possibly arise. The stock of clothing, equipage, quartermaster's, subsistence, hospital, and ordnance stores, arms, ammunition, and field artillery is sufficient for the immediate equipment of large armies. The disbanded troops stand ready to respond to the national call, and, with our vast means of transportation and rapid organization developed during the war, they can be organized, armed, equipped, and concentrated at whatever points military emergency may require. While, therefore, the war expense have been reduced to the footing of a moderate and economical peace establishment, the national military strength remains unimpaired and in condition to be promptly put forreduction of the volunteer force and the advantageous disposition or concentration of war material were thus successfully accomplished without diminishing the military power of the country, recruiting and reorganizing the Regular Army favorably progressed. In consequence of the difficulty in procuring enlistments for the regular while so many men were required for the volunteer service 153 companies of the Regular Army, as then authorize, were unorganized on May 31, 1865, but in theollowing July these companies had been completed. Under the act of July 28, 1866, the Regular Army now comprises 10 regiments, or 120 companies, of cavalry, 5 regiments, or 60 companies, of artillery, and 45 regiments, or 450 companies, of infantry; of which 2 cavalry and 4 infantry regiments are composed of colored men, and 4 infantry regiments of men who were wounded in the line of their duty. One regiment of white cavalry had been fully recruited on September 15; the other regiment, assigned to the Pacific Coast, is very nearly completed. Forty- eight of fifty-four companies required to convert into regiments the single battalions of the nine three-battalion regiments of the former organization have been completed and sent to their regiments. The four Veteran Reserve regiments have been assigned to districts where the men may be usefully employed in guarding store-houses and cemeteries and on similar duties. The colored regiments will be recruited, as far as possible, from the colored volunteers still in service. The law authorizes an assignment of 100 privates to a company as the maximum, fifty being minimum, and the maximum strength of the Army is thus placed at 75,382, rank and file. The present strength of companies is fixed at 64 privates for cavalry, artillery, and infantry, and 122 privates for light batteries of artillery, making an aggregate strength of 54,302. As soon as the ranks shall be well filled it is designed to increase the efficiency of the military force by raising the standard of qualifications.

The troops in service were regularly paid, and the demands of those discharged and mustered out promptly met. During the fiscal year ending June 30, 1866, $10,431,004.42 were disbursed to the Army and Military Academy, $248,943,313.36 to volunteers; and in the disbursement of millions of dollars in small sums, and amid great difficulties and hazards, the total cost to the Government, in expense of every character, is but a fractional portion of 1 per cent.

Every effort has been made to promote the comfort and health of the Army and to give the best medical treatment to the wounded and sick. Well-grounded apprehensions of the appearance of Asiatic cholera as an epidemic early in the present year required prompt