Essendon legend James Hird has again ruled himself out as a candidate to coach the AFL club, following rampant speculation that he himself helped generate.

Betting agencies have rated Hird one of the favourites to take over from Matthew Knights, behind Port Adelaide premiership coach Mark Williams and Bombers assistant Alan Richardson.

But a day after the Bombers sacked Knights, Hird said his position had not changed since Knights took over from Sheedy three years ago.

Hird has also hit back at rumours he secretly accepted an offer from Essendon to take over from Knights, but then declined.

On Sunday afternoon, Hird had said his life would have to change dramatically before he could consider coaching Essendon.

Asked to expand on that comment, Hird told Fox Sports' On The Couch program on Monday night: "I don't know ... I'm sitting here saying it's probably not going to happen, I've said the same thing for three years and I get a little bit frustrated.

"If you believe everything that has been said over the two weeks about me and that football club, then I think you have rocks in your head, because the majority of it is untrue."

The speculation about Knights' future took a dramatic turn on August 18 when Hird said in a newspaper article: "there's something in me, deep in my heart, that says at some point I want to coach Essendon."

The Brownlow Medallist quickly backed away from the comment once he realised the stir it had caused.

But the speculation has continued and Hird is growing increasingly frustrated.

He is particularly upset about the rumours of a secret deal with the club.

"It's just an un-truth - offered the job, accepted the job and knocked it back, totally untrue," Hird said.

"I wasn't offered the job, I didn't accept it and I don't know why people keep going on with this."

Hird added that the decision last year to extend Knights' contract by two years had "obviously totally backfired".

He said there was much more to Knights' sacking than the disastrous end to the season.

"The whole three years has come into it, not the last four weeks," he said.

"It hasn't been the performance that (then chief executive) Peter Jackson and the board that appointed him three years ago wanted.

"They expected top-four position around now."

Also on Monday, Knights expressed his disappointment at being axed, but his manager insists he wants to continue coaching.

Knights spoke briefly, saying he would take the next few days to consider his immediate future.

Essendon have agreed to pay out the remaining two years of his contract at a cost of up to $1.1 million.

"I'm obviously disappointed but we'll look at things as the week goes on and at some stage I'll come out and speak to the media," Knights said.

His manager Dan Richardson said Knights was keen to coach again despite being dumped midway through a contract.

Richardson added Knights knew he was under pressure but his sacking on Sunday still came as a shock.

"You'd have to be silly not to realise there was certainly going to be some pressure come the end of the year and he was well aware of that," Richardson told Fairfax Radio.

"I think to some degree though it was unexpected.

"The problem was from day one from the start of this year that I don't think anyone came out strongly enough from the club and said that we can guarantee that he will be coach next year.

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