I'm not 100% sure, but it looks to me like you've downloaded a pre-built Sage (based on the directory name sage-4.7-linux-64bit-ubuntu_10.04.1_lts-x86_64-Linux) and then tried to build it yourself (I don't know what command you tried that produced the install log, perhaps you ran make from the SAGE_ROOT?)
Note: On Linux systems like Debian/Ubuntu, you may have to install the build essential package, the m4 macro processor, and gfortran: