Oh dear. He's supposed to be with his mom still, who at this point would be teaching bite inhibition. Yorkie puppies learn a lot of their manners at this age, and really benefit greatly if not taken from mom before 12 weeks.
So no, the puppy does not know what he is doing is wrong. The way you are correcting him is not alright. You cannot swat a yorkie puppy. A light tap with one or two fingers on their hindquarters is more than enough to get their attention. But I highly doubt he's being "aggressive".
__________________  The T.U.B. Pack! Toto, Uni, & Bindi
RIP Lord Scrappington Montgomery McLimpybottom aka El Lenguo the Handicapped Ninja 10-12-12 
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