The letter makes reference to the offer for peace negotiations made by the Central Powers on December 12, 1916, an offer that was rejected by the Entente.
The photo depicted at the end of this Christmas wish is not the photo referred to in the letter. This is an ironic postcard of the time, of a mother telling her child the "fairy-story" that once upon a time, the whole world was at peace.
The letter was written on December 18, 1916. Despite the fact that it was clearly a personal letter, it was opened by the XIVth Battalion in Freiburg "under martial law".