“Since these measures have been in operation, all demands on the Treasury, including the pay of the Army and Navy, have been promptly met and fully satisfied. No considerable body of troops, it is believed, were ever more amply provided and more liberally and punctually paid; and it may be added that by no people were the burdens incident to a great war ever more cheerfully borne. “The receipts during the year from all sources, including loans and the balance in the Treasury at its commencement, were $901,125,674 86, and the aggregate disbursements, $895,796,630 65, leaving a balance on the 1st of July, 1863, of $5,329,044 21. Of the receipts there were derived from customs, $69,059,642 40; from internal revenue, $37,640,787 95; from direct tax, $1,485,103 61; from lands, $167,617 17; from miscellaneous sources, $3,046,615 35; and from loans, $776,682,361 57; making the aggregate, $901,125,674 86. Of the disbursements, there were, for the civil service, $23,253,922 08; for pensions and Indians, $4,216,520 79; for interest on public debt, $24,729,846 51; for the War Department, $599,298,600 83; for the Navy department, $63,211,105 27; for payment of funded and temporary debt, $181,086,635 07; making the aggregate, $895,796,630 65; and leaving the balance of $5,329,044 21. But the payment of funded and temporary debt, having been made from moneys borrowed during the year, must be regarded as merely nominal payments, and the moneys borrowed to make them as merely nominal receipts; and their amount, $181,086,635 07, should therefore be deducted both from receipts and disbursements. This being done, there remain as actual receipts, $720,039,039 79; and the actual disbursements, $714,709,995 58, leaving the balance as already stated. “The actual receipts and disbursements for the first quarter, and the estimated receipts and disbursements for the remaining three-quarters, of the current fiscal year 1864, will be shown in detail by the report of the Secretary of the Treasury, to which I invite your attention. It is sufficient to say here that it is not believed that actual results will exhibit a state of the finances less favorable to the country than the estimates of that officer heretofore submitted; while it is confidently expected that at the close of the year both disbursements and debt will be found very considerably less than has been anticipated. “The report of the Secretary of War is a document of great interest. It consists of-- “1. The military operations of the year, detailed in the report of the General-in-Chief. “2. The organization of colored persons into the war service. “3. The exchange of prisoners, fully set forth in the letter of General Hitchcock. “4. The operations under the act for enrolling and calling out the National forces, detailed in the report of the Provost Marshal General.