The bailout: An owner's manual

How much will it cost?

The initial addition to the federal debt would be $700 billion, although the Congressional Budget Office believes the net budget loss will be "substantially smaller" because the government can recoup some of its losses and perhaps sell the securities for a profit later. There are also administrative costs, which the CBO currently estimates at perhaps "a few billion dollars per year."

However, the newly added tax provisions of the bill alone will cost the government an additional $110.4 billion by 2018, according to a just-released study by Congress' Joint Committee on Taxation. Only $3.4 billion of that is related to the "bailout" portion of the bill. The AMT fix and the extension of certain tax incentives will cost $107 billion over the next 10 years. The energy provisions are completely paid for.

• In pictures: What billionaires say about the Wall Street crisis

Is it big enough?

Probably. The administration asked Congress for $700 billion, thinking that was a large enough number to restore confidence to the markets, clean up the balance sheets of troubled companies and prevent it from asking for more. One thing that might help: Under the current version of the bill, banks issue the Treasury stock warrants, giving taxpayers a chance at making money once the crisis subsides.

That isn't going to be the only remedy, though. Already the Federal Deposit Insurance Corp. (FDIC) has stepped up its oversight of troubled banks, and the agency is taking a more aggressive view to recapitalizing banks or forcing mergers of strong banks with weak banks before they fail.

The Federal Reserve is also playing its part. It is pumping hundreds of billions into the banking system -- nearly $1 trillion in actions announced this week -- to help alleviate the pressure on balance sheets as banks reduce their leverage. The Fed will continue to flood the system with money through the next few months, with the year-end balance sheet preparation looming.

What happens to the companies that participate?

They will have to give the government the ability to acquire shares and executives at the companies will be subject to more restrictive compensation rules.

There is the possible stigma of participating, since it may make them appear to be weak. But if everybody does it.

So who will use it and who won't?

Joshua Siegel from Stone Capital Partners, a New York private equity firm that invests in small banks, says the regional banks stand to gain the most from the plan. That is a group that includes National City (NCC, news, msgs), Fifth Third Bancorp (FITB, news, msgs), Sovereign Bancorp (SOV, news, msgs), Colonial BancGroup (CNB, news, msgs) -- all companies whose shares have been pounded down in the market tumult. In addition, the American Bankers Association has pressed to make sure it's available to all 7,000-plus banks, not just those with big mortgage exposure.

But will the big banks use it? Citigroup (C, news, msgs) still has more than $500 billion of assets it wants to unload gradually. "They could say 'I can make it without it,' " Siegel says, "or they could take a little" and see what happens. JPMorgan Chase (JPM, news, msgs) is taking on Washington Mutual and its $1.9 billion in assets and liabilities. Bank of America (BAC, news, msgs) is dealing with absorbing Merrill Lynch (MER, news, msgs) and Countrywide Financial (CFC, news, msgs).

JPMorgan's CEO James Dimon supports the plan but says he's not inclined to use it. Though he may change his mind after it becomes clear just how the program is going to work.

Continued: The best-case scenario?

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