"Delegations of the people of Georgia continue to come in, and I am satisfied that, by judicious handling and by a little respect shown to their prejudices, we can create a schism in Jeff. Davis's dominions. All that I have conversed with realized the truth that slavery as an institution is defunct, and the only questions that remain are what disposition shall be made of the negroes themselves. I confess myself unable to offer a complete solution for these questions, and prefer to leave it to the slower operations of time. We have given the initiative, and can afford to await the working of the experiment. "As to trade matters, I also think it is to our interest to keep the Southern people somewhat dependent on the articles of commerce to which they have hitherto been accustomed. General Grover is now here, and will, I think, be able to handle this matter judiciously, and may gradually relax, and invite cotton to come in in large quantities. But at first we should manifest no undue anxiety on that score, for the rebels would at once make use of it as a power against us. We should assume a tone of perfect contempt for cotton and everything else in comparison with the great object of the war--the restoration of the Union, with all its right and power. If the rebels burn cotton as a war measure, they simply play into our hands by taking away the only product of value they have to exchange in foreign ports for war-ships and munition. By such a course, also, they alienate the feelings of a large class of small farmers, who look to their little parcels of cotton to exchange for food and clothing for their families." Early in January the Secretary of War, Mr. Stanton, visited Sherman at Savannah and spent several days with him there. They discussed together many important topics, such as the disposition of the cotton, treatment of the negroes, etc. The future of the war was also carefully considered, and Sherman had much correspondence with Grant and Halleck on the same subject. Sherman's own idea was that the rebels should be thoroughly whipped and their pride broken. He would march to the innermost recesses of their country and strike terror to every disloyal heart. Toward the negroes his attitude was kindly, and he favored enlisting them in the army and forming black regiments and brigades.