The deadlock continues, with Hamas refusing to compromise on its goals of destroying Israel and driving Jews from the region. Even though nearly three billion dollars in aid is being offered, if Hamas will make peace, Hamas refuses to do so. Hamas is on a Mission From God, and acts the part. Negotiations over the release of Israeli soldier Gilad Shalit, held by Hamas for three years, also broke down (over the issue of how many senior terrorists would be released, and how many would be released outside if Gaza or the West Bank). In response to this, Israel arrested ten Hamas leaders in the West Bank, and restricted visitors and packages for 11,000 Palestinian prisoners. Israel has also continued its operations against terrorist group leaders in Gaza (where they are killed by missiles) and the West Bank (where they are taken alive, if possible.)
Israeli military and intelligence officials talk openly of "finishing" the military operations against Hamas. The January 18 ceasefire is considered just that, and it's expected that Hamas intransigence during any negotiations will result in a deadlock and the resumption of fighting. The second round is expected to be a death match, with no end until the Hamas leadership is captured or killed, and Hamas weapons (especially the thousands of rockets) captured or destroyed.
Israel now believes that Hezbollah and Hamas have over 50,000 rockets in place, to fire on Israel. Most of these rockets are small (under 100 pounds, with a range of under ten kilometers). Most of the rockets are controlled by Hezbollah in Lebanon, and can only reach largely Arab communities in northern Israel.
March 18, 2009: Lebanon refuses to have direct peace talks with Israel, preferring to do so only as part of regional talks (involving Syria, mainly because Syria still believes large parts of Lebanon actually belong to Syria.)
March 16, 2009: In the West Bank, two Israeli policemen were shot dead as they were on patrol in their car. A Palestinian terror group later took credit for the killings.
March 14, 2009: Israel agreed to release 450 jailed Palestinian terrorists in return for the freedom of Israeli soldier Gilad Shalit. Hamas is willing to do the deal, but the two sides are arguing over where those Palestinians will be released. Israel wants many of the worst terrorists released in Gaza, or deported. Negotiations are deadlocked over this issue.
March 13, 2009: United States, Canada and seven European nations agreed to pool their intelligence and diplomatic resources to try and keep weapons from getting into Gaza. This will not work without the cooperation of Egypt, and Egypt cannot afford (for political reasons) to shut down the weapons smuggling. Meanwhile, two more rockets were fired from Gaza into Israel. Hamas asked whoever is doing this, to please stop.