from The Magic Mirror Book (originally titled Make a Bigger Puddle, Make a Smaller Worm), devised and illustrated by Marion Walter, Scholastic, 1971 Some awkward illustrated-by-the-author greatness (see also Daniel Pinkwater or Munro Leaf)
Summary: A girl named Linda wakes up and goes for a morning stroll in her neighborhood. On her way, she encounters some locals, including a shirtless bearded man whom she calls "Santa".
This is Frank Asch's second children's book. He is best known for his Moonbear series from the 1980's-90's.