The Associated Press reports on Israeli plans to build 300 new homes in an East Jerusalem settlement based on their contention that East Jerusalem is not occupied territory (2.) In the American Prospect, Israeli author and journalist Gershom Gorenberg analyzes Israeli PM Olmert's reluctant and incomplete conversion to a true believer in a complete Israeli withdrawal from the occupied Palestinian territories (4.) The Jewish Telegraphic Agency reports on a new Israeli hardline right-wing fund established to offset the effect of left-wing groups on Israelis (6.) The Telegraph (UK) reports on the discrepancy between successive Israeli governments' pledges to demolish illegal settlement structures with actual demolition (8.) An Asharq Alawsat opinion by Hussein Shobokshi draws hope from the emergence of a Palestinian 'third way' (10.) In Miftah (Palestine) Joharah Baker laments the damage to the Palestinian cause that disunity has done (12.) A Jerusalem Post (Israel) opinion by B'Tselem executive director Jessica Montell is critical of Israel's policy in Gaza resulting in a humanitarian disaster for Palestinian civilians (14.)