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Evidence analysis is all about the perceived reliability of the source and the information it contains.
A six-year old knows when his birthday is. He knows it because he has been told it. While his knowledge of the precise date comes from what others have told him, his general idea of his age does not. If a child is around other children--as this one apparently is because he attends school--then he knows approximately how old he is from first hand experience. He knows he's older than any three or four year olds that he sees and he's also well-aware that he's not ten or eleven years old. James would provide primary information for his age based upon his first hand knowledge.
Because the statement made by James comes from a handwritten letter that was in a newspaper there is always the chance that an error snuck in. The word "six" is spelled out in James' letter as it appears typed in the newspaper and it is reasonable to conclude that he wrote it that way in his letter as well. If the number "7" had been used instead, the chance of a potential typographical or transcription error would have been higher.
Realistically speaking, there's a good chance that James was actually born on 1 November 1894. Hopefully a researcher doesn't have to use a letter to Santa Claus as a source, but it's always possible. Of course, it should be cited so that if more contemporary sources for James' birth are located, a proper analysis can be conducted.
James provides primary information for his age, but not for his date of birth based upon how he came to know both those pieces of information.
The letter is the newspaper is a derivative source. The original letter is the original source. Sources contain information.
And you thought Santa Claus letters were only for requesting genealogical presents for yourself?
The citation manual for genealogical research is Evidence Explained: Citing History Sources from Artifacts to Cyberspace 2nd Edition. A shorter, less-detailed guide is the Bureau for the Certification of Genealogists' Genealogy Standards: Fiftieth Anniversary Edition. And there's always Casefile Clues--which is easy to read and understand and very practical.