The Washington Post report on the story is here.
Some quick points. It is quite likely that the US treasury will make money on this deal. The 700 billion number represents the amount of loans that are potentially in default. The securities represented by these mortgages are already trading at steep discounts to their face value and it is likely that after the market settles down in a few months they can be restructured and sold at a profit to the government.
By inviting the leadership and the two Presidential candidates to the White House tomorrow, I think it is quite likely that a deal has already been struck and they will be there to bless it. This makes McCain look better than Obama and also means they can make the debate on time.
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