Israel displays military assets to journalists. Hamas is showing signs of moderating its policies. Egyptian activists are urged to cancel a march to Gaza. Palestinians launch a $15 million equity fund. Palestinians and Israelis make progress on sports talks. PM Fayyad says a sudden salary crisis will be solved soon. The number of Palestinians has increased eightfold since 1948. American Christian fanatics warn Palestinians about an upcoming “apocalypse.” Palestinians demonstrate for the right of return. Likud sources say PM Netanyahu’s upcoming US speech will offer no concessions. Yossi Verter says there is no reason for this, but Netanyahu will find one. Hamas and Fatah agree to hold simultaneous municipal elections sometime in the future. Fayyad reiterates Palestinians are ready for statehood. Saeb Erekat says Israel has to choose between peace and apartheid. Palestinians speak about a potential third intifada. Israeli security officials say Egypt isn’t doing much to stop arms smuggling into Gaza. Israeli forces are on alert for Nakba Day. Some refugees from a Palestinian village destroyed by Israel in 1948 have managed to quietly return. A CUNY trustee is asked to resign over remarks suggesting Palestinians are “not human.” JJ Goldberg says Israel's security elite is turning against Netanyahu. The National condemns Israel’s wholesale cancellation of Palestinian residency rights in the occupied territories. Israel is accused of trying to push Palestinians out of the Jordan Valley. Hassan Haidar asks when Israelis will begin protesting their government. Palestinian officials in the Gulf say an independent state may try to join the GCC. The US Supreme Court is set to rule on the legal status of Jerusalem.

Another aid flotilla has left Turkey for Gaza. Armenians in Jerusalem face an uncertain future. Israeli Amb. Oren denounces the Palestinian national unity deal. Most Israeli leaders continue to support Pres. Assad remaining in power in Syria. Pres. Obama is likely to give a major speech on the Middle East next week, but one focusing mainly on the Israeli-Palestinian conflict will probably be delayed until August. Sources say Pres. Abbas may become PM as well, possibly with acting-PM Fayyad and a Hamas leader as his deputies. Other accounts see a push for Fayyad to remain PM. Settlers stone cars near Nablus. Israel is accused of exploiting Jordan Valley water supplies. Israeli sources speculate Netanyahu will not make any major concessions in an upcoming US speech, but Ari Shavit says he must acknowledge the 1967 borders. Fayyad urges Arab aid to the PA. Hamas is skeptical about planned PLO moves in the UN in September. A Fatah official says without negotiations the PA might not be able to stop another intifada. Larry Derfner says because of the occupation, there is no analogy between Israeli actions and the US raid that killed Osama bin Laden. The UK ambassador to Israel says the international community should be ready to take advantage of any opening from the Palestinian unity agreement. Gideon Levy says Israel continues to be guided by the spirit of ethnic cleansing. Amira Hass looks at arbitrary arrests of Palestinians by occupation forces. The Forward looks at Fayyad’s future. George Hishmeh looks at obstacles facing Obama from Netanyahu. Daoud Kuttab says Abbas’ consistency should be acknowledged.

Palestinians are planning to create a central bank and currency. Palestinians are skeptical of the efficacy of protests. Ori Nir says Israelis should celebrate interdependence with Palestinians as well as their own independence. A Hamas leader reiterates it will not recognize Israel, and another gives Israel one year to recognize a Palestinian state. The first Palestinian corporate bonds are issued. The European Union will give the PA €85 million to help meet payroll. PM Netanyahu will address Congress on May 24. PM Fayyad may retain his position in a new government, which Hamas and Fatah leaders are meeting in Cairo to discuss. France may host an international meeting on the conflict. Palestinian leaders condemned Israel’s withholding of tax revenues, which Amira Hass calls “robbery,” and comments by the finance minister. Israel freezes construction of part of the separation barrier. Shlomo Avineri says peace requires Palestinian self-criticism. An Israeli court issues temporary orders stopping demolition of Palestinian homes. DM Barak presents new peace proposals. Israel is making a major investment in real-time satellite capacity. FM Lieberman says Israel will talk to the PA but not freeze settlements. A new study shows Israel stripped 140,000 Palestinians of Jerusalem residency from 1967-1994. Palestinian-Israeli security cooperation may be in jeopardy. Analysts consider how far Hamas will compromise with Fatah, and Osama Al Sharif says many obstacles to the agreement remain. Jameel Theyabi looks at the relationship between Hamas, Syria and Iran. Hussein Ibish says not enough information is available for a serious analysis of the Hamas-Fatah agreement.

Palestinians say public employees cannot be paid if Israel withholds tax revenues. Some see the Fatah-Hamas deal as a new chance for peace. Jimmy Carter says the US should support the agreement. Fatah plans to review its strategies. France increases aid to the PA to offset Israel’s actions, the UN asks Israel to release the funds, and the US calls the Israeli move “premature.” PM Fayyad calls the fiscal situation “impossible.” The head of J Street says Israel must act now on peace. Pres. Abbas says Palestinians are determined to win UN recognition in September. Pres. Peres says Israel might negotiate with Hamas. The Globe and Mail profiles a Palestinian billionaire. Ha’aretz says Israel is evading reality. Pres. Obama sends Israel Independence Day greetings. Amr Mousa says Hamas is not a terrorist organization. Issa Bourshieh says Israel must embrace its Arab citizens. A powerful film about Palestinian nonviolent protests against occupation is released on DVD. CUNY reverses its decision not to honor Tony Kushner. The daughter of a right-wing Israeli Rabbi talks about meeting Abbas. Palestinian citizens of Israel feel disenfranchised. Attention is on the effect of the Palestinian unity deal on Hamas’ policies, and Asharq Al-Awsat interviews one of its leading figures. Ghassan Khatib says Palestinian dialogue may foster Hamas moderation, and Mkhaimar Abusada says the international community can help, but Yossi Alpher says Hamas has not changed yet.

Pres. Abbas urges continuation US aid and says Hamas will not have a role in the West Bank. The push for unity highlights divisions in Palestinian society. The New York Times says the US should not cut off aid to the PA. The Washington Post interviews the new Egyptian FM. Richard North Patterson says the US and Israel need a Palestinian state. A Palestinian man is wounded in a shooting in the West Bank. Reuters interviews Hamas leader Misha’al. Hamas pledges to coordinate all decisions regarding Israel with Fatah, may be considering recognizing Israel, and may agree to Egyptian terms for releasing a captured Israeli soldier. Abbas reportedly wants PM Fayyad to continue in his post, and says national unity is crucial for peacemaking. Israeli officials think Hamas signed the unity deal from a position of weakness. Zvi Bar'el says the agreement has cast PM Netanyahu adrift. Abbas meets representatives of J Street. Kadima leader Livni says that a settlement freeze would have prevented the Palestinian unity deal. Pres. Peres says Abbas is still Israel’s partner. Egypt will grant citizenship to children of Palestinian fathers and Egyptian mothers. World leaders urge Israel to release Palestinian tax revenues. Hamas’ militia may be trying to seize power. Magid Shihade looks at the balance of forces between Fatah and Hamas. Rami Khouri says Palestinians have given up on the US and Israel. Refugees in Lebanon support the agreement. Khairallah Khairallah says Israel hopes that Hamas will continue the bin Laden tradition. Hussein Ibish looks at political obstacles to implementing Palestinian state-building.

The Palestinian reconciliation accord brings a new sense of urgency to the issue. The CUNY trustee who blocked an award for playwright Tony Kushner implies Palestinians are “not human.” PM Netanyahu says Israel could accept Palestinian statehood by September under certain conditions and that France will insist on Palestinian recognition of Israel as a Jewish state. Israeli troops arrest five Palestinians in Jenin. Hamas leader Misha’al criticizes the killing and burial of Osama bin Laden. Hamas says it will maintain the de facto truce with Israel. Settlers are using tourism to draw other Israelis to the West Bank. Netanyahu says only negotiations can achieve peace. Analysts say international pressure is likely to force Israel to keep transferring Palestinian taxes to the PA, but Israel’s finance minister ridicules the idea. The UN stages Gaza’s first marathon. Nehemia Shtrasler says Netanyahu doesn’t seem to understand time is not on Israel’s side. Another Israeli cabinet minister calls for annexing occupied territories in the event of Palestinian statehood recognition. Sec. Clinton reiterates that Hamas must accept the Quartet conditions to become an interlocutor. J Street says a new Palestinian government should be given a trial period. The “Arab Spring” poses new problems or Israel. The unity deal meets with guarded praise in the Middle East press. PM Cameron says Hamas must recognize Israel. David Makovsky asks if the unity agreement will threaten Palestinian commitments. Palestinian parties begin the process of forming a new government. Hassan Haidar says the unity agreement will make it harder to exploit the Palestinian cause. Ahmad Majdoubeh says Palestinians should declare statehood. Abdel Monem Said Aly says the Arab-Israeli conflict will now be judged on democratic principles. Hamid Alkifaey says a democratic Arab world will embrace peace with Israel.

Sec. Clinton leaves the door open to continued contacts with Palestinians after the signing of the unity deal. Major obstacles remain in implementing the deal, though the parties agree to the quick creation of a new government. PM Fayyad agrees the deal must be implemented swiftly. Palestinians express optimism. Lebanon and Jordan welcome the deal, while Israelis are divided. The US says the agreement must advance the peace process. Ha’aretz says it’s an opportunity, not a threat. Aaron David Miller says its filed with dangers. D. Bloomfield asks if this “marriage of convenience” can survive. Yaakov Katz says the deal is a survival tactic for Hamas. David Ignatius looks at past mistakes on peace. PM Netanyahu prepares to come to Washington. Hamas complains its operatives are still being held in the West Bank. Netanyahu’s military attaché avoids a UK trip because of possible prosecution. Israel’s mayor in Jerusalem declares the city “indivisible.” The UK and France say they made back recognizing Palestinian statehood. Many East Jerusalem residents say they prefer Israeli citizenship. Larry Derfner says if Hamas is what Palestinians are offering Israel, there will never be peace. International aid to the Palestinians may continue. CUNY withdraws an honorary degree from playwright Tony Kushner due to comments critical of Israeli policy. Jewish Democrats say the quest for peace should continue despite the Palestinian agreement. A survey of campus boycott activities finds much action but little accomplishment. Palestinians in Syria are trying to stay neutral during unrest. Michael Young says regional events pushed the Palestinians together. Bilal Hassen says Palestinians still face a diplomatic deadlock. The Arab News says Netanyahu must now choose between settlements and peace.

Palestinians express optimism about the new national unity agreement. The signing ceremony in Cairo is delayed over a dispute whether Hamas leader Misha’al would give an address as well as Pres. Abbas. Palestinians say the US has not objected to the agreement. Four candidates are frontrunners to be the next Palestinian Prime Minister, not including incumbent Salam Fayyad. Jimmy Carter urges support for the deal. Huge gaps remain between Fatah and Hamas. Hamas leaders vow to never recognize Israel. An Abbas aide says Hamas doesn’t have to recognize Israel. Amr Moussa says Palestinian reconciliation will pressure Israel. PM Netanyahu tours Europe lobbying against the Palestinian unity deal. The National looks at the compromise behind the deal. Israeli conductor Daniel Barenboim performs in Gaza. Hamas executes a man convicted of collaboration. Jordan’s FM says the US role is vital to resuming negotiations. Ha’aretz says Netanyahu must present a new peace initiative in his upcoming Washington trip. Sefi Rachlevsky says Israel and Netanyahu faces simple choice between peace and becoming a racist state. The US expresses outrage at Hamas’ condemnation of the killing of Osama bin Laden. Ali Ibrahim finds Hamas’ praise of bin Laden to be “strange.” Netanyahu suspends a major East Jerusalem settlement project. The UK ambassador to Israel says security can only come through peace. Israel says it will recognize many unauthorized settler outposts. The new head of the Union for Reform Judaism is a member of J Street’s rabbinic cabinet.

Hamas refusal to take sides in Syrian strife is raising tensions. Hamas says it will honor an unofficial cease-fire with Israel under a new unity government. 13 Palestinian factions meet in Cairo for the unity agreement. Israel’s threat to withhold Palestinian tax revenues exposes economic vulnerabilities under occupation, and PM Fayyad says salaries cannot be paid without that income. Gazans protest Hamas’ condemnation of the death of Osama bin Laden, while others rally in praise of him. Palestinians blame settlers for a mosque fire in the West Bank. Concerns grow that Fayyad may not be part of a new government. Pres. Abbas’ office calls for maintaining calm with Israel. Ha’aretz says Pres. Obama must bring his daring to Middle East peace. Aluf Benn says Obama must use his new clout wisely, including between Israel and the Palestinians. The US Supreme Court will rule on the case involving the legal status of Jerusalem. Gershon Baskin says the Palestinian unity deal may offer new opportunities for peace. Yehudah Mirsky says the Quartet should maintain its positions with any new Palestinian government. George Semaan says national unity is the first step towards Palestinian statehood. Linda Heard warns Egypt may be walking into an Israeli trap in Gaza. Ghassan Khatib says the unity agreement is good for peace, but Yossi Alpher says it’s not a finished product and Israel shouldn’t interfere. Shlomo Brom provides an Israeli analysis of the Palestinian unity deal.

Israel says it may end tax revenue transfers to the PA, prompting calls from the US for clarification and from PM Fayyad for international intervention. Hamas’ leadership denies it is leaving Syria. Palestinian leaders are making their way to Cairo for a national unity agreement signing ceremony. The deal may be partly the result of new Egyptian foreign policy, which Rami Khouri says marks Egypt’s return to the Arab fold. Hamas says the next prime minister must be from Gaza, but Fatah officials say Fayyad may remain in office. Aaron David Miller says the deal creates the illusion of unity. Israel feels increased tension and pressure. Egypt calls on the US to recognize a Palestinian state. Likud hardliners call for annexing the West Bank. The planned opening of the Gaza-Egypt border may cause new problems for Israel. The PA welcomes the death of Osama bin Laden, but Hamas condemns it and calls him a “holy warrior.” Israeli conductor Daniel Barenboim will perform a “peace concert” in Gaza. Akiva Eldar and the Daily Star both welcome the Palestinian unity agreement and Amira Hass says it may serve Israeli policies. Tzachi Hanegbi says PM Netanyahu should announce plans for Israeli national unity. The Arab News says Pres. Obama has capitulated to Israeli intransigence.