Rau is head of state, Schroeder is head of Gouvernment (ranking 3rd in the state). If the President says something, you can be sure, that the chancellor will do it (otherwise the President wouldn't say it).
Rau greets foreign visitors, appoints ministers (on the request of the chancellor), federal judges and so on.
He can pardon felons and signs (or denies to do so) laws etc.
From the eng.bundespraesident.de page:
--snip
From the point of view of protocol, the Federal President as head of state occupies the leading position. He is the constitutional organ which represents the Federal Republic of Germany both at home and abroad. He does so by making the state - its existence, legitimacy, legality and unity - perceptible in all he does and in every public appearance. This highlights his role as a figure of integration and his monitoring function in his capacity as guardian of the law and the constitution. Furthermore the Federal President has fall-back powers which he can use if the parliamentary system of government is in a crisis situation.
The classic functions which the Federal President as head of state performs include:
- representing the Federal Republic of Germany at home and abroad (public appearances at state, social and cultural events, speeches, visits to the Länder and communities, state visits abroad, receiving foreign state visitors),
- representing the Federal Republic of Germany in terms of international law (Art. 59 (1) sentence 1 of the Basic Law), concluding treaties with foreign states (Art. 59 (1) sentence 2 of the Basic Law), accrediting (appointing) German diplomatic envoys and receiving (accepting the letter of accreditation of) foreign diplomats (Art. 59 (1) sentence 3 of the Basic Law).
His other important tasks include:
- proposing the Federal Chancellor for election (Art. 63 of the Basic Law), appointing and dismissing the Federal Chancellor (Art. 63 and 67 of the Basic Law) and the Federal Ministers (Art. 64 of the Basic Law), - dissolving the Bundestag (Art. 63 (4) sentence 3, Art. 68 of the Basic Law),
- promulgating (signing) and publicizing laws
(Art. 82 of the Basic Law),
- appointing and dismissing federal judges, federal civil servants, commissioned and non-commissioned officers
(Art. 60 (1) of the Basic Law),
- exercising the power to pardon on behalf of the Federation
(Art. 60 (2) of the Basic Law).
--snap
You'll find further Information here :
http://eng.bundespraesident.de/frameset/index.jsp (Federal President)
http://www.bundestag.de/htdocs_e/index.html (Bundestag lower house)
http://www.bundesrat.de/Englisch/index.html (Bundesrat upper house)
http://eng.bundesregierung.de/ (federal Gouvernment/ Chancellor)