Melkor is chained. The Blessed Realm is experiencing “the fullness of its glory and its bliss. Rúmil of Tirion brings the beginnings of writing.
During this time is born the eldest sons of Finwë, including his most beloved, Fëanor (“Spirit of Fire”). His birth consumed the body and spirit of his mother Míriel to the point where she sought release from the burden of life. She asks to be held “not blameless in this,” though it can be argued that much of what happens is a direct result of her willingness to give up. Her spirit departs, and her body remains incorruptible. And as is typical, those she leaves behind are miserable, beginning with her husband.
Fëanor grew quickly and turned out to be crafty and skilled. He improved on the writing system, creating Tengwar. From there, he started learning to create gemstones, which will come into play something fierce in the next chapter. He married the daughter of the great smith Mahtan, who in turn had learned at the feet of Aulë himself. Finwë remarries, but Fëanor distances himself from the new bride and their sons. Fëanor blames his father not raising him properly for the great evil to come. Note: it’s never good when a character goes off to act alone and blames everyone else for it. It’s also those who learn through the lines of Aulë that seem to wreak this kind of havoc. It’s all part of Tolkien’s commentary on technology and progress as he saw it.
Meanwhile, Melkor has served his prison sentence of “three ages,” and is due for parole. Being brought before the throne of the Valar, Melkor immediately lusts after their glory and wealth, and envy pretty much powers him. But he bides his time and pledges to help to heal the hurts he has caused. He is pardoned, but he isn’t trusted enough to leave their sight. Tolkien notes that Manwë was free from evil and couldn’t comprehend it. So essentially we’re looking at a world not as Eru envisioned it, but as it adapted to what Melkor unleashed, much like the world in Biblical Genesis following the expulsion from the Garden of Eden. Tolkien also notes that Ulmo was not deceived, and Tulkas was slow to forget. So Melkor is slowly stewing and plotting, and the Valar are expecting the other shoe to drop.
And it does drop in the form of Fëanor, who learned more art and instruction directly from Melkor. Interestingly, Fëanor hated Melkor more than any other, naming him Morgoth. Much like Melkor and Sauron later on, Fëanor worked alone, asking counsel of none with the notable exception of his wife, Nerdanel the wise.