Watermelons have sold at $20 each; corn, $10 per dozen ears; and everything else in the markets in proportion.

My yellow tomatoes are just maturing. The dry weather has ruined nearly everything else in the garden.

August 9th.—Very hot; very dry; very dusty.

The President has directed the late Gen. (now Lieut.-Col.) Pemberton to organize a mortar and cavalry force to dislodge the enemy from Deep Bottom, on this side of the river, and to select three or four batteries to render the navigation of the James River difficult and dangerous. Col. P. says he must have some 1500 cavalry, etc.

Letters from Mr. McRae, our agent abroad, show that our finances and credit are improving wonderfully, and that the government will soon have a great many fine steamers running the blockade. Mr. McR. has contracted for eight steel-clad, steamers with a single firm, Frazer, Trenholm & Co.—the latter now our Secretary of the Treasury.

The President indorsed a cutting rebuke to both the Secretary of War and a Mr. (now Lieut.-Col.) Melton, A. A. General’s office, to-day. It was on an order for a quartermaster at Atlanta to report here and settle his accounts. Mr. M. had written on the order that it was issued “by order of the President.” The President said he was responsible for all orders issued by the War Department, but it was a great presumption of any officer in that department to assume to indorse on any paper that it was by his special order, and that, too, “by command of the Secretary of War,” the usual form.

August 10th.—Hot and dry until 4 p.m. Gust, and 15 minutes’ rain. Good for turnips.

Forts Gaines and Powell are lost—the latter blown up. Gen. Maury telegraphs for infantry, has some 4000 men for the defense of Mobile, etc.

Our raiders, under McCausland and Bradley Johnson, it is said were surprised and defeated last Sunday, with loss of 400 men, 500 horses, and 4 pieces of artillery. A rumor prevails that Early has gained another victory near Winchester.

No news yet from our agent sent to North Carolina to purchase supplies, but we learn flour and bacon are not held one quarter as high there as here. I do sincerely hope Grant’s raiders will keep quiet until I can get something to eat!