Here is how waiver trading works.
Any player on a team's 40-man roster is subject to waivers. So, therefore, all active big leaguers and some upper level minor leaguers will be going through waivers this month.
If a team places a player on waivers and they go unclaimed, the team can negotiate trades involving that player with any team in the league, as if it was still before July 31.
However, if a team places a player on waivers and a team claims him, the two teams must negotiate a trade within 48 1/2 hours.
For instance, if the Padres place James Shields on waivers (which they are likely to do), and the Cubs claim him (which is less likely), the Padres and Cubs have just over two days to talk a trade regarding Shields.
If the teams cannot come to an agreement on a trade in the 48 1/2 hour time frame, then the club can either pull their player back (keeping him on his original club) or let the other team claim him for absolutely nothing, but will have to take on his whole contract.
Also, if a team is forced to pull back their player in August, they can place the same player on waivers a second time, however, these waivers are non-recoverable (cannot pull them back).
So, if the Padres and Cubs cannot come to an agreement over Shields, the Padres could either pull Shields back to San Diego or have the Cubs take the rest of his contract for free.
If multiple teams claim a player on waivers, the order in which claims are awarded is: the league the player is in from worst to best record followed by the league the player isn't in from worst to best record.
If the Cubs and Red Sox place claims on Shields, the Cubs would be awarded the claim because Shields plays for an NL team and they are the NL. If the Cubs and Phillies place claims on Shields, he will go to the Phillies, as they both are NL teams, but the Phillies have a worse record than the Cubs.
Candidates to be moved in August trades are players signed to what is considered to be "poor" deals.
The reason these players have a good chance at being moved is that no team wants to risk taking on their entire contract by placing a claim on him, even if they would receive the player for free. This makes Shields a good bet to clear waivers.
Players to be named later are often common in August deals, as these players could be on the 40-man roster of the team that was moving them, but not able to clear waivers. Also, players in the lower levels of the minors are also candidates to be moved.
Teams can make trades in September as well, but any player acquired after August 31 is not eligible for the postseason with their new team.