[Extract.]

Mr. Koerner to Mr. Seward

No. 85.]

Sir: * * * * * * *

It is stated here in various journals, which are likely to receive information from ministerial circles, that Mr. Preston has gone to Mexico to establish commercial relations with the new empire, and to procure its recognition of the Confederate States. It is also said in some of the papers that Spain has entered into a treaty with the new emperor, reserving the throne of Mexico, in case of failure of issue, to a Spanish prince. This would be an important fact if true, as it would secure the moral co-operation of Spain in the establishment of the new empire, and would have a tendency to place Spain in a somewhat antagonistic position to the United States. That Spain, in the end, would be cheated of her expectations I have no doubt; but still it is not altogether improbable that some inducements have been held out to her, which may have some present effect.

I have the honor to be, with the highest respect, sir, your obedient servant,

GUSTAVUS KOERNER.

Hon. William H. Seward, Secretary of State, &c.