General Lee's despatch.
Immediately after the receipt of this despatch, a number of rumors were started through the city, and speculation was rife as to where Grant was making for. Some thought that with his army beaten and demoralized, and himself smarting under the disappointment of not being nominated at Baltimore, he was withdrawing his army to Washington. Others that he was marching back to Fredericksburg. Others again thought that he was making for Suffolk, to move against the railroads in North Carolina. Others that he was sending off the bulk of his army to reinforce Sherman in Georgia. And still another opinion was that he was moving off to the south side. Ridiculous as some of these were, they were the rumors of the day, and as such we note them. To heighten this speculation, a deserter who came in yesterday reported that Grant was under arrest for drunkenness; that he had been dead drunk since the day of the fight near Hanover Court-house, and had to be borne in an ambulance. All this tended to increase the anxiety, and to give color to every rumor that was heard in the streets; but by night it was pretty definitely ascertained that Grant, or at least the greater portion of his army, had crossed over to the south side. We heard of no official intelligence of this, but from information we received last night we see no reason to doubt it. Westover, where General Lee in his despatch above states the enemy to have moved, is immediately on the James river, not far from Bermuda Hundred, where Butler is, and the river at that point is narrow and well situated for the laying down of pontoons. It is likely he crossed his forces over here, and effected a junction with Butler. At any rate, it was generally reported and believed last night that the enemy was moving on Petersburg, and a rumor was current that fighting had commenced between the two armies. We learned last night, on inquiry in official circles, that they had been advised of no fighting beyond some skirmishing yesterday with Dearing's cavalry, in which our pickets were driven in. Otherwise, they reported all quiet. But private accounts reported that the enemy was around Petersburg, and that his forces were in line of battle in front of the outer fortifications. This may be a little extravagant, a little too far; but from all we can learn, we think it is likely that Grant has effected a junction with Butler, and designs moving on Petersburg, with the view of cutting our lines of communication with the South. Finding that he cannot whip us he will probably resort to the other expedient of starving us.