According to an interview on MLB.com with Brian Cashman. The yanks could sign Manny, but have no interest.

Here is an excerpt from the article....

Technically, the Yankees could improve even more and pursue a Type A free agent like Ramirez, which would be completely within baseball's rules.


complete article here.....

http://mlb.mlb.com/news/article.jsp?...2008&fext=.jsp