They love to talk, my friend, if you listen. [Radagast assumes it's some magic, Men and Elves have their own he doesn't meddle with so long as they don't harm the Arda. And this one doesn't seem like a threat, Radagast holds out his arm to let the squirrel make his way over to Aang.]

He's a squirrel of this forest, living in that tree which is quite old by his recollection. [The wizard nodded with certainty.]