The Spain international was outstanding in yesterday's 3-2 win at Sporting Gijon, scoring twice.
Isco is willing to stay, but Don Balon says Real president Florentino Perez has left him disappointed over new contract negotiations.
The midfielder is seeking €4 million-a-year to stay, but Perez is refusing to go higher than half that amount.
In contrast, Barca are willing to make Isco among their squad's best paid.
Isco knows the controversy such a move would bring, but for now is refusing to shut the door.
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