With only a month until the trade deadline, expect to hear plenty of rumors. According to Marc Carig of the Star-Ledger, the Yankees have expressed interest in Colorado reliever Huston Street.
A major league source, who requested anonymity because he isn't authorized to comment on other teams, told me that the Yankees' reported interest in Street was serious. The source said that Yankees general manager Brian Cashman approached the Rockies about a deal as early as the middle of May, as the Yankees' bullpen struggled. Meanwhile, the source said the Rockies had already begun combing through the Yankees' minor league system, mining for possible trade targets. (source)
The Rockies went 20-7 after manager Clint Hurdle was axed, and are currently unsure about where they stand in the market, but if they make Street available the Yankees will certainly explore a trade. In my opinion, they'd be better off looking for a more affordable option, but Street would be a great fit for the long term. Especially if he reverted back to his 2007 form.
There are plenty of other options, and if the Yankees are going to upgrade any part of their club, it'll be the bullpen. They could look into guys like Rafael Betancourt, Chad Qualls, Chris Sampson, Octavio Dotel, Kiko Calero or Kevin Gregg.