http://news.independent.co.uk/europe/article314237.ece

This first part is specualtion:

the talks seem destined to fail. The Social Democrats refused to back down from their insistence that Mr Schröder should remain chancellor in a grand coalition while Mrs Merkel remained equally adamant that she should be given the job.

"[Schröder] will not succeed in forcing us to give up our right to lead the next government," Ms Merkel said.

And then there is this:

At the same time, Chancellor Schröder's Social Democrats started an uphill battle to win over the small but influential liberal Free Democratic Party as partners to join them in a so-called "traffic light" coalition government with the Greens. Otto Schily, the SPD Interior Minister, urged the liberals to drop their outright opposition to a "traffic light" alliance. "Much of our agenda fits the liberals much more than the conservatives. The FDP's position is premature," he said.

The liberals, who have categorically ruled out any coalition with the Greens and Mr Schröder's party, refused even to respond to the SPD's bidding yesterday.

The Greens dampened the SPD's hopes even further by saying that they had "major reservations" about joining forces with the FDP.

So what this all seems to me to sound like, even though it is still all speculation, is new elections in 2006...

"Once in awhile we get shown the light, in the strangest of places, if we look at it right" - Hunter/Garcia