The credit of the government was reported as being well sustained. The accumulated debt was still small, notwithstanding the magnitude of the military operations in which the Confederate States were involved. Congress at its last session had provided for an issue of bonds, to be used in the purchase of supplies, but sellers of produce had shown such a decided preference for treasury notes as to encourage the increased issue of that kind of currency. In answer to the apprehension that this inflation might produce a hurtful depreciation, the message proposed that the notes should be convertible into eight percent bonds of the Confederate States, which was considered as a sufficient and permanent safeguard.
The war department earnestly advised additional legislation to promote the proper execution of the conscript act, and particularly to unite depleted companies and regiments by some fair system of consolidation. Some important railroads had become greatly impaired by the heavy demands for transportation, and it was be coming necessary for the government to take control of military transportation, and to put the roads into good serviceable condition. The President recommended an increase of the army to meet the large accessions recently called into the field by the President of the United States. Further enrollment may not become necessary, but that necessity might possibly arise during recess of Congress, and hence legislative authority should be given for calling such forces at once into the field. Referring to the exchange of prisoners he was able to state that the long denied object had been recently effected, and was being executed, and he expressed the hope that the cartel would speedily restore " our brave and unfortunate countrymen to their places in the ranks of the army from which by the fortunes of war they have for a time been separated. The navy department had been actively engaged in attaining the best possible results by the use of all the means it could command. Part of its effective work was
