> 
>> Rails is failing on a syntax error in your database.yml file.  It has
>> nothing to do with PostgreSQL at this point.
>> 
>> My guess is that instead of two leading spaces on that line you've got a
>> tab.  Or some other unicode character pretending to be a space...
>> 
>> Fix that and see what happens...
>> 
>> -philp
> 
> That certainly changed the result. Now it's
> 
> rake db:migrate --trace
> (in /oldhome/michael/projects/movies)
> ** Invoke db:migrate (first_time)
> ** Invoke environment (first_time)
> ** Execute environment
> ** Execute db:migrate
> rake aborted!
> uninitialized constant 
> ActiveRecord::ConnectionAdapters::PostgreSQLAdapter::PGconn

Try the 'pg' gem.

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