From John Harper of the Daily News:

... a person in regular contact with Yankee brass said Tuesday he believes the club still wants Pettitte back and believes a deal will get done, perhaps as early as next week.

According to this person, someone in the Yankee organization was putting out that word as something of a scare tactic, knowing that Pettitte badly wants to pitch for the Yankees next season. "They just want him at their price, that's still the bottom line," the person said.

Not sure how much stock should be put in "a person in regular contact with Yankee brass," but there you have it.

Via Tim Dierkes.