Jurgen Klinsmann's shadow continues to loom large over Liverpool.
It is believed that contact between Klinsmann and the club has taken place at a high level and the German is thought to be interested in taking over at Anfield.
Despite assurances that there is money to spend in the January window, Benitez's public rift with Tom Hicks and George Gillett over the club's transfer policy may be beyond repair.
Boardroom backing for Benitez has been lukewarm in the wake of reports linking Klinsmann with the job.
Sources close to the ex- Tottenham striker and former Footballer of the Year believe he is eager to end his self-imposed exile from football and take a top manager's job.