Mark Halperin says two sources "who know" say McCain is picking Romney. This is a pick that has long made sense demographically. If two of the four the toughest battlegrounds include Colorado and Michigan, Romney's Michigan roots and his strength in Western states with high LDS concentrations make him a demographically smart pick.
However, Al Giordano hits upon a great point given today's narrative - Romney owns a lot of homes too. You can hear the counter-line already rolling off Democratic tongues: "Those guys are tough to beat. They own homes in almost every state."
Thus, while Romney makes sense from a demographics sense, he probably hurts from a narrative one. While we're down on the idea that VPs should be chosen to swing a certain state (unless the candidate is from a small state typically ignored by national campaigns), the total package can further a narrative about the top candidate. "McCain warmed to Romney once he saw how many estates he had."
The narrative consequences aren't all bad. While many observers have noted that McCain's camp overreacted by throwing the kitchen sink in response to today's seven-houses attack, it seemed more that McCain's team has been waiting for this excuse to go as hard as possible with as much as possible.
So, Romney does present the Democrats' best opportunity to continue the narrative they've discovered today, but it also shows that it's not as much a narrative election as it is a demographic one. Once McCain started talking about how his polling data showed the base had been solidified, he didn't have to worry as much that Romney would frighten those Republicans to whom Romney's Mormonism is a big turn-off.