You're never as bad as you look when you're playing poorly, and you're never as good as you look when you're playing well.
But while the Yankees certainly aren't this bad, when you look at their roster, the idea of them winning 90 games seems pretty far fetched. I never thought they would win the division this year, but I did expect them to take the WC. But then their number two starter went down, and they suffered some very steep regressions on offense. The pitching will get worse, and unless guys like A-Rod, Swisher, and Jeter rebound in big ways, making the playoffs doesn't seem all that likely.