...is never happening. ever.
Seriously, they're done. No joke.
Now go soothe yourself by listening to Give Up over and over.
You know you want to.
(So basically the news that started this was that even though they began work on a new release in Summer '06, Ben Gibbard and Jimmy Tamborello have both stated that they're going in other directions and that the project is not a priority for either of them. That means that we'll see them tour on the old record before you ever hear a single thing off of a new record.)
Ahh, memories. Semi-morbid, post-high-school-pre-college memories.