The Yankees' farm system is strong enough to match up with the Padres if the teams revive their discussions on right-hander Jake Peavy. The Padres, according to one major-league source, told the Yankees that a deal would be possible even if the Yankees declined to offer right-hander Phil Hughes.

The Padres scouted Hughes in a recent Arizona Fall League game, but the Yankees have zero intention of trading him.

The Yankees, according to several industry insiders, spent yesterday preparing an offer - perhaps a five-year deal worth about $80 million - for Toronto righty A.J. Burnett. This would come after they offered Milwaukee lefty CC Sabathia a six-year contract worth between $140 million and $145 million.

The Blue Jays already have offered a four-year, $54-million deal to retain Burnett, according to the Toronto Star. The Yankees' offer is expected to top the Blue Jays' in average annual value. However, a source shot down a report that the Yankees would offer five years and $80 million. They will not make an opening bid of more than four years or anywhere near $80 million, the source said.

"I'm looking to keeping my options open, keep working out,'' explained Williams, who last played in 2006. "It's been a great two years. I've had the opportunity to do things that I never really had the opportunity to do when I was playing. I had the chance to travel. Take my kids to school, watch my kid graduate from high school, a lot of things that I never would have never had the opportunity to do if I had been playing the game.''

"I want them both," Damon said yesterday of CC Sabathia and A.J. Burnett.

"And I hope we also get Derek [Lowe]."

"The Yankees organization is excited and honored to host the Chicago Cubs in two exhibition games to be played at the new Yankee Stadium," said Yankees co-Chairperson Hal Steinbrenner. "As we welcome our fans into the ballpark for the first time, it is fitting to showcase two of Baseball's greatest and most historic franchises."

"We are thrilled to have such a great organization in the Chicago Cubs agree to play the first-ever exhibition games as we unveil Yankee Stadium," said Yankees President Randy Levine. "It will be a symbolic event for the fans of two iconic teams while we celebrate the beginning of a new chapter in this proud franchise's history."

Even though Varitek’s agent, Scott Boras, said at the GM meetings two weeks ago that Jorge Posada’s four-year, $52.4 million contract should, as a gauge of Varitek’s worth, be considered “probably representative age-wise and it’s also representative of what a player on a winning team - for very different reasons, obviously - can do,” word is that Boras is not asking for a Posada deal.

A $50 million contract worth some $13 million a year is not in the offing for Varitek. It should require something closer to a two- to four-year deal worth $10-11 million a year to sign Varitek. He is coming off a four-year, $40 million deal.

Teams expected to be in on the bidding include the Tigers and Angels. Do not dismiss the chances of the Yankees going after Varitek as doubt remains about whether Posada’s shoulder, surgically repaired last season, will allow him to catch in 2009.