Roger Cohen says Israel is driven by deep but groundless fears. Hamas still preaches resistance but is criticized by more extreme groups for suppressing anti-Israel activity. Several Israeli leaders hint at an unannounced settlement freeze in occupied East Jerusalem, and PM Netanyahu suggests territorial compromise on Arab neighborhoods and a Palestinian state with "temporary borders." Hamas says Palestinians expelled from the West Bank will not be allowed into Gaza. Palestinians say a settler rally is a "provocation." Special Envoy Mitchell meets DM Barak, as Israel offers "gestures" to the Palestinians. The UN says the recent easing of the Gaza blockade shows more can be done. Yossi Verter says Israel cannot avoid US pressure. The Forward condemns intimidation against Judge Goldstone. Patrick Seale looks at the rise of religious fanaticism in the Israeli military. George Hishmeh says Israel is in danger of becoming a pariah state.

Martin Indyk says PM Netanyahu must choose between confronting his right wing or the US president, and that when Israel can go it alone, it can decide things on its own. FM Lieberman says an "imposed solution" would provoke violence. Hamas burns recreational drugs, taxes cigarettes. The PA denies reports of an upcoming peace summit. US officials strongly criticize an ad saying Jerusalem is beyond politics. Bradley Burston says Israel must be freed of the occupation. YNet interviews PM Fayyad on state-building and nonviolent protests. The Israeli military complains about settler violence, prepares for a West Bank pullback. The New Israel Fund gets more donations in the wake of intense criticism. American Jewish leaders are criticizing the administration in public, but defending it in private. Israeli and Palestinian villagers build relationships across the Green Line. Rahm Emanuel says there is no US peace plan. The UN says Palestinian armed factions in Lebanon are a threat to regional stability. Bret Stephens says the US should leverage Israeli concerns about Iran for progress on settlements. Rashid Khalidi says Israel is acting in bad faith in Jerusalem.