Jerusalem Capitol of Israel AND Palestine?

Mid-east peace talks are underway, and it is reported by some that the city of Jerusalem is going to be a huge bargaining chip.  Palestinians have claimed it for their inheritance, as has Israel [of course, since they now occupy it].  What ought a Christian to think about this situation?  There are, of course, Christians in Palestine (and a few in Israel, too).  Should the sacred city be divided?  No.  But I am not as concerned about the theological reasons as I am the political ones.

Israel has negotiated land away in Palestine and the West Bank—all in an effort to bring peace to the Middle East.  Yet, the claim now is that Palestine must also have Jerusalem.  Half of Jerusalem would be only a stop-gap measure.  Once the half belongs to the Palestinians (in this case read Hamas—the terrorist group running the government), then the whole of Jerusalem will be demanded.  As far as I know, Hamas has never backed away from its original founding purpose: to push Israel into the sea.  [They did, however, agree to a 10 year truce in response to the land already given away].