The 16 months of violence continues, with 1,189 dead (911 Palestinian, 256 Israelis). The war between Israel and Palestinians continues, although Palestinian leader Yasser Arafat has been trying to rein in Palestinian radicals with scant success. Arafat is trying to rebuild relationships with Arab nations that long supported him. These nations are dismayed at the way Arafat has managed his affairs and allowed Palestinian radicals to call the shots. Most Arab nations have come down hard on their local radicals, after finding you can't make deals with people on a Mission from God. 

Israel has been intercepting or preventing more terror attacks against civilians, but there are more attacks being attempted.