Real Madrid 3-4 Schalke: Initial reaction

What's happening to this Real Madrid squad? Everybody was expecting a pleasant game to regain some momentum ahead of El Clásico, but Schalke were able to win 3-4 at the Bernabéu and put Madrid with their back against the wall for the last 10 minutes of the match.

• Max Meyer destroyed Real Madrid's midfield and showed that Ancelotti needs to play with a holding midfielder between the defensive line and the attackers. Kroos' positioning is still not good enough.
• This is not what Bale was signed for. The Welsh attacker is playing as if he was just another right back, and it's not easy for him to contribute offensively when he's that far away from his attacking teammates.
• Sami Khedira is still playing for this club and this should not be acceptable. The German player does not want to be here and Ancelotti should have that in mind before placing him on the starting lineup once again.
• The Bernabéu is tired. The fans sang "fuera, fuera" -- out, out -- right after the game ended. That scene had not happened since Real Madrid's Copa del Rey tie against Alcorcón during Manuel Pellegrini's year in Real Madrid.
• What's wrong with Raphaël Varane? Will he be an elite defender again?
• Did Schalke deserve to go through? During these two games, they hit the post twice.
• Real Madrid need to get their act together. Now.