Berlin, Oct 5, SPA -- German Chancellor Gerhard Schroeder andconservative rival Angela Merkel head into a third round oftalks Wednesday on forming a possible coalition, looking toresolve a deadlock over who should lead Europe's biggesteconomy and end a two-week political crisis. Both Schroeder's Social Democrats and the conservativesinsist they are willing to enter formal coalition talksafter each failed to secure a majority in Sept. 18parliamentary elections. But Merkel's conservatives demand that Schroeder's partydrop its campaign to prolong his seven years in office.While Schroeder has signaled he would step down if hisparty tells him he must, the Social Democrats have stuck totheir claim that he should lead any new government. Merkel's Christian Democrats and the Bavarian ChristianSocial Union argue that since they are the largestparliamentary bloc, their candidate should be chancellor,and that detailed talks make no sense until the matter issettled. Dieter Althaus, a senior conservative, said the twoparties would have to delay more detailed negotiations ifthe Social Democrats do not give in. "It's about accepting the rules of the democratic game:that the strongest faction provides the head of thegovernment," Althaus said on ARD television Tuesday night. He said Wednesday's talks would address problems withgovernment finances, high unemployment and the stretchedpension system, but said he saw no sign of an overallcompromise.--SPA1247 Local Time 0947 GMT www.spa.gov.sa/294359