In large bowl with electric mixer at medium speed, beat butter, sugar, egg yolks and extracts until light and fluffy. Add flour and nuts. Mix well with hands. Turn dough out onto lightly floured surface. Divide dough in half. With hands, shape each half into a 16-inch long roll. Cut each roll into 16 pieces, then shape into balls. Press a whole clove into each piece. Place 1 inch apart on ungreased cookie sheet. Bake at 350 degrees F for 20 minutes or until cookies are set but not brown.
Remove cookies to a wire rack and sprinkle lightly with confectioners' sugar while still warm. Cool. Before serving, sprinkle with confectioners' sugar again.
* 2 teaspoons ouzo (anise-flavored liqueur) or brandy or may be substituted for the vanilla extract.