Do the math, given these results (more or less):
1. To get the president's mandate to form the next government, Benjamin Netanyahu, who has fewer seats than Tzipi Livni, will need to lock-down a majority of Knesset members, which means a coalition of
Likud+Lieberman+Shas+various ultraOrthodox and ultraNationlist parties.
This he can almost certainly do, and, given his victory speech, intends to, although Lieberman and Shas despise one another. And Netanyahu will find himself in Obama's Washington and the mainstream media about as popular as Rush Limbaugh.
2. For Tzipi Livni to get to a majority, she would need:
Kadima+Labor+Shas (or Lieberman)+Meretz (or Arab parties).
Shas (or Lieberman)+Meterz+Arab parties? Forget it.
3. Netanyahu or Livni or both could work toward a "national unity" government:
Kadima+Likud+Labor (or Lieberman, or Shas).
Netanyahu would (in one version) have to concede the prime minister's chair, as the major party with fewer seats--which he would be utterly opposed to, since he could form a rightist government of his own.
Or Livni would (in a second version) concede the prime minister's chair and lose the chance to anchor a fighting opposition, with Labor in opposition, and Netanyahu busy alienating the world.
There is talk of a rotation agreement, as in 1984.
MY BET IS that Netanyahu will form a rightist government, take his chances with Washington, the collapse of relations with the PA, and riots among Israeli Arabs.