New Year's Pretzels

2 c. milk
1/2 c. butter
2 pkg. active dry yeast
2 tsp. salt
1/2 c. sugar
7 c. flour
2 large eggs
1 c. powdered sugar
1 T. water
1 1/2 tsp. vanilla or almond extract
1/4 c. almonds or walnuts, chopped

Heat milk and butter until very warm. Mix yeast, salt, sugar, and 1 c. flour. Slowly beat warm milk into yeast mixture. Beat for 2 minutes. Add eggs and 1 c. of flour. Beat for an additional 2 minutes. Add enough flour to form a soft dough. Knead until smooth and elastic, about 5 minutes. Place dough in a greased bowl. Let rise in a warm place until doubled in bulk, about 1 hour. Punch dough down and let rise again until doubled. (1 hour more). Divide dough in half.

Shape pretzel: Roll dough into a rope about 30" long and 1 1/2" in diameter. Cross the ends leaving a large loop in the center. Flip loop back onto crossed ends to form a pretzel. Repeat with remaining dough. Place pretzels on greased baking sheets. Let rise 15 minutes more. Bake at 375F. for 25 to 30 minutes or until golden brown. Cool on wire racks. Mix powdered sugar, water and vanilla to form a thin icing. Spread icing on pretzels and sprinkle with chopped nuts. Makes 2 large pretzels.