**President Obama
*AP: Today in Germany, Obama called "for all of us to redouble our efforts" toward separate Israeli and Palestinian states. "The moment is now for us to act," he declared. He also said he didn't seek any commitments from Germany to take a dozen prisoners when the United States closes its prison for terrorism suspects at Guantanamo Bay.

*Obama denied it at a press availability this morning, but the New York Times reports that he has an "increasingly strained relationship with Chancellor Angela Merkel. ... there are underlying tensions and disagreements on matters ranging from the global economic crisis to the future of inmates held at Guantánamo Bay. On a more basic level, there is a sense that the Obama administration is ignoring the needs and counsel of longtime allies."

*Secretary of State Hillary Clinton backed up Obama's message, telling Fox News Channel: "It is really critical that we make clear, as the president did in this magnificent speech he gave, that we want to work with people all over the world, regardless of religion. We have no feeling of hostility or conflict with Muslims everywhere... I thought that it was important that we all be here to send a strong signal that America is doing what the president said we would do in his inaugural address."

*Another czar! The Obama administration plans to appoint Kenneth Feinberg as a Special Master for Compensation "to ensure that companies receiving federal bailout funds are abiding by executive-pay guidelines," the Wall Street Journal reports. Feinberg oversaw the 9/11 victims fund.

*Politico senses a political pattern to administration officials' travel on the stimulus. "Top officials have hosted events predominantly in states that Obama won in 2008. What's more, the examination revealed that Obama officials all but avoided Southern states that Obama lost."

*The White House announced more top ambassador nominations. Three of them were top bundlers, First Read notes.

*East Wing changes: First Lady Michelle Obama replaced her chief of staff, Jackie Norris, with Susan Sher, "a longtime friend and colleague. ... The shift means that three of the top positions in the East Wing are now held by old friends of the first lady."

**Judge Sotomayor
*WSJ: "While Judge Sonia Sotomayor stands in the liberal mainstream on many issues, her record suggests that the Supreme Court nominee could sometimes rule with the top court's conservatives on questions of criminal justice."

*WaPo: Speeches released yesterday show "a strong-willed jurist who has exacting expectations of herself and those who come before her -- and who is driven by a powerful ethnic pride and a belief that she has an obligation to lift up fellow people of color. 'The Latina in me is an ember that blazes forever,' she told Hispanic law students at Hofstra University in 1996."

*AP: "She likes to eat pig intestines and watch "Law & Order." She felt like an alien in the Ivy League. She reads fictional courtroom dramas and hands down imaginary rulings on the lawyers' objections therein. Judge Sonia Sotomayor's self-portrait, revealed in scores of speeches and writings released Thursday, portrays a "daughter of the Bronx" who rose from a lower middle-class background to the academic and legal elite -- but felt panicked on the cusp of each step up."

*Also from yesterday's questionnaire, Hotline notes that Sotomayor was contacted by the White House days before Justice Souter announced his retirement.

*Sen. Susan Collins (R-Maine) addressed concerns about Sotomayor's race remarks when they met yesterday. ABC: "Collins said she found the speech troubling, but said Sotomayor told her she 'meant is as inspirational' to the students at the conference sponsored by the Berkeley La Raza Law Journal. Collins said Sotomayor assured her that while she used the phrase before, 'she said she would not be using it again, which does not surprise me,' said Collins."

*Most significant cases? "Sotomayor highlighted a 1995 decision that ended a baseball strike and another that condemned China's forced-abortion policy, as she submitted hundreds of pages of documents yesterday outlining her legal career to the Senate committee that will consider her nomination. ... The five boxes of files, giving senators a fuller picture of Sotomayor's background and record, also show that the White House contacted her about serving on the high court four days before Justice David Souter announced that he would retire," Boston Globe reports.

*It looks like Sotomayor did vote for Obama.

**Congress
Gallup: "Democratic House Speaker Nancy Pelosi and former Vice President Dick Cheney have little in common politically, but they receive almost identical image ratings from the American public. According to a May 29-31 Gallup Poll, 37% of Americans have a favorable view of Cheney and 34% have a favorable view of Pelosi. Both Cheney and Pelosi are viewed unfavorably by at least half of Americans."

*"Senate Majority Leader Harry Reid (D-Nev.) could not reach an agreement with Republicans regarding consideration of a tobacco regulation bill Thursday evening, effectively forcing the chamber to allow more time for the legislation next week after it already consumed an entire week's worth of debate," Roll Call's Jessica Brady reports.

*Speaking of tobacco, Sen. Tom Coburn (R-Okla.) wants to outlaw cigarette smoking, The Hill reports.

*Washington Post looks at the troubled past of a company with ties to Rep. John Murtha (D-Pa.).

*Intel: "Republicans ignited a firestorm of controversy on Thursday by revealing some of what they had been told at a closed-door Intelligence Committee hearing on the interrogation of terrorism suspects.Democrats immediately blasted the GOP lawmakers for publicly discussing classified information, while Republicans said Democrats are trying to hide the truth that enhanced interrogation of detainees is effective," The Hill reports.

*LA Times reports that lawmakers are pressing forward with health care legislation without an ailing Sen. Ted Kennedy, "a politically and emotionally fraught move that could dramatically alter the course of what is expected to be a titanic legislative struggle." The Massachusetts senator "had planned to formally introduce his version of the healthcare overhaul shortly after Congress returned from recess this week. But he remains out of town, undergoing treatment, and is not expected back at the Capitol for at least a week or two."

**Campaign Stuff
*VA Gov: Moran camp's response to Montana Gov. Schweitzer endorsing McAuliffe this morning: "The guy who was rumored to be running for Governor of New York, and wanted to be Governor of Florida is having the Governor of Montana tell us why he should be Governor of Virginia? That makes about as much sense as running TV ads saying he cares about people's jobs when the Washington Post concluded that McAuliffe made millions off his political connections while people were laid off and lost everything. If these media reports are true, we welcome Governor Schweitzer to Virginia tomorrow, although he might be coming because he's worried that Terry McAuliffe would have chosen to run in Montana next."

*Cillizza weighs the significance of endorsements by Schweitzer and Pennsylvania Gov. Ed Rendell. "Does anyone doubt that McAuliffe, who badly needs a strong showing among African Americans to win on Tuesday, would rather have the support of prominent African American elected officials like Rep. Bobby Scott (D-Va.) or former Richmond Mayor Doug Wilder -- both state-specific, non-statewide endorsers -- than Schweitzer and Rendell?"

*Mark Sanford finally threw in the towel in his stimulus fight, after the state Supreme Court ruled he must take $700 billion in education funding. "But Sanford, a possible 2012 presidential candidate, also called the ruling 'terribly flawed" and said the decision reinforced his long-held belief that South Carolina's political system places too much authority in the hands of the state legislature," CNN reports.

*Norm Coleman aides are denying a Roll Call report that the former senator will concede the race if the state Supreme Court rules against him.

*IL Sen: "Politicians throughout Illinois have flirted with the idea of making a run for the seat, but most are still waiting to commit. The current officeholder, Democratic Sen. Roland Burris, is almost certain to bow out, according to people familiar with his thinking," Politico reports.

--Mike Memoli and Kyle Trygstad