I just got off the phone with Rich Galen, a top adviser to Fred Thompson, and it would be an understament to say that he is strongly denying the Politico story reporting that Thompson "will drop out of the race within days if he finishes poorly in Thursday's caucus."

The story cites "several Republican officials close to Fred Thompson's presidential campaign." Galen told me, "I'm a Republican official in the Thompson campaign, and I'm denying it." Galen also said that no one inside the campaign was a source for the story. "I can't put enough adjectives in front of the 'deny' to accurately describe how vehemently I'm denying the story," he said.

Galen said that "just to make sure," he checked with Thompson himself, who told him the story was not true. "We have the schedule for Saturday and Sunday in New Hampshire, and then we're going down to South Carolina," Galen told me.

"That is absolutely made up out of whole cloth," said the former U.S. Senator from Tennessee.

Thompson said a rival campaign was likely the source of that rumor.

"Can you imagine such a thing in politics?" he asked.

Thompson said his campaign is seeing a "surge" in interest right now, and said he has visited 50 communities in the Hawkeye State in the last couple weeks.

"I'm not going to play into any scenario that's not totally optimistic," he said.

But in practical terms the timing is everything. A pull-out before Saturday obviously boosts McCain in NH. But the very floating of the rumor on the eve of caucus could depress the Fred vote in Iowa and lead to Fredsters switching to McCain on caucus night itself, making the story not the Romney comeback in Iowa (which I expect to happen) but the bi-state turnaround of the McCain campaign.

FOX ANCHOR: Without a solid third place finish there's no point going on according to a Thompson advisor in today's Politico.com. Is that true, Fred? Do you feel that way?

FRED THOMPSON: No, that's not — I heard about — I heard about that this morning. There is no such Thompson advisor. That's not something that I have thought about, that's not something I have discussed with anybody. It's something made up out of whole cloth and dropped here at the last minute, probably by one of the other campaigns by staffers with too much time on their hands apparently, but that's the kind of thing you run into. No truth of that at all.