What was going on when I was born?

Israeli troops with tanks and armored personnel carriers reportedly moved into a village just five miles southeast of central Beirut tonight. If the troops consolidate their position, it could lead to the virtual encirclement of the capital and the Palestinian guerrilla forces there. Earlier, a brief cease-fire between Palestinian guerrillas and Israeli forces was shattered in a day of fierce fighting south of the city between Israeli troops and Palestinian guerrillas as well as repeated Israeli air strikes against West Beirut. The cease-fire was worked out Saturday by the Lebanese and United States Governments. If the Israelis hold their position in the village, Baabda, it would mark a major turning point in their seven-day invasion. It would put Israeli troops astride the strategic Beirut-Damascus highway at the entry of Beirut, choking off the last exit or entry route for the Palestinian guerrilla forces in the capital.

Typically, when a recession ends, businesses are caught with empty shelves and scramble to raise raw material inventories and production. This provides momentum to the entire economy. ''Usually, early in a recovery, demand for inventories suddenly grows rapidly, and purchasing agents can't raise inventories as fast as they wish,'' said Albert T. Sommers, chief economist at the Conference Board, a business research organization. ''In the first six months of the recovery, the economy usually moves from substantial liquidation of inventories to substantial accumulation, and that's a great kick to the business cycle.''

Senate Republicans and the Reagan Administration buckle down this week to solving one of the great riddles of democratic politics: How to raise taxes in an election year without suffering on Election Day. Possibly as early as Tuesday, the Republican-controlled Senate Finance Committee will start drafting a bill to raise revenue, mostly from business but perhaps from some individuals, particularly those in upper-income brackets. Tax bills usually originate in the House Ways and Means Committee, but the House Democrats are waiving their prerogative because they want the Republicans, especially President Reagan, to take the lead - and greater political risk, the Democrats reckon - on raising taxes. Both the Republicans and the Democrats want to show themselves as committed to smaller budget deficits, and to that extent they may find common cause. But each has a partisan purpose as well - the Republicans to show that they are not the party of the rich, the Democrats to force the President to concede, at least tacitly, that last year's three-year tax cut was irresponsibly big -and so their ways may part.

An article in Metropolitan Report on Thursday incorrectly described the role of Albert Shanker, president of the United Federation of Teachers, at a meeting in Washington on racial in- tegration of the teachers in New York City's schools. Mr. Shanker was in- vited to the meeting and participated in the discussion.

Jan Stephenson of Australia became only the third foreign player to win the Ladies Professional Golf Association title in the 28 years of the tournament when she shot a one-under-par 71 today for a 279. Miss Stephenson, who led from start to finish, gained a two-stroke victory over JoAnne Carner. Mrs. Carner also had 71 today. With her victory, Miss Stephenson joined Sally Little, a South African who won the 1980 L.P.G.A. title, and Chako Higuchi of Japan, who won the 1977 crown, as the only foreigners to win this tournament. ''Pressure from outside things,'' Miss Stephenson said, ''have kept me from winning lately when I was playing well enough to win. This means so much to me in bonuses and other things so I can overcome the people trying to hurt my game.''

An article yesterday incorrectly listed the program for tonight at Avery Fisher Hall. The program will be a dance and instrumental benefit by the National and Greater New York Conferences on Soviet Jewry working for the emigration of the pianist Vladimir Feltsman.

The middle-aged man carrying a carton had hardly arrived at the market when he was surrounded by women eager to buy his handmade shoes. A teen-age girl grabbed a pair, tried them on and then happily handed over the equivalent of $70. Across the plaza facing Havana's 17th-century Cathedral, a dozen straw baskets were also snapped up as soon as they appeared on sale, while shoppers in a nearby store looked for something to buy among dresses, buttons, crockery, jewelry and little lamps made out of shells. The supply of goods, though, fell far short of demand. In recent weeks, the Cuban Government has decided that its ''capitalist'' experiment in free markets for food, clothes, shoes and other products has gotten out of hand and it has ordered a clampdown, arresting 200 people in the process.

A 1979 Federal court judgment instructing the Board of Education to improve its programs for handicapped students has already cost New York City more than $250,000 in legal fees, and those costs could reach $1 million if the case continues to grow, according to board officials. Those costs include the fees of lawyers who represent the board's opposition and must be paid mainly by the city under Federal civil rights legislation. They also include the fees of a court- appointed special master and the fees of outside lawyers that the board hired recently to help it stop the outflow of money by trying to find some way to resolve the case. ''This is a lawyer's employment industry, this case,'' said David M. Wirtz, counsel to the Schools Chancellor, Frank J. Macchiarola.''It's giving a lot of well-intentioned people a lot to do without much result.''

Central Park and the thoroughfares that led hundreds of thousands of singing, chanting demonstrators to Saturday's antinuclear protest were quiet and bare yesterday, with cleanup efforts completed more quickly and less expensively than had been expected. As many of the thousands of out-of-town demonstrators began to return home on a rainy Sunday, parks officials praised the participants for their cooperation and restraint. ''Perfect isn't adequate to describe what happened yesterday,'' the Parks Commissioner, Gordon J. Davis, said by telephone yesterday morning. ''I'm standing at the Great Lawn, and it looks better than it did before the rally.''

International A new Israeli advance was under way five miles from central Beirut soon after a cease-fire between Israel and the Palestine Liberation Organization collapsed in bitter fighting. Israeli troops with tanks and armored personnel carriers reportedly moved into a Lebanese Army-controlled mountain village. If the troops consolidate their position, it could lead to the virtual encirclement of the capital and Palestinian guerrilla forces there. (Page A1, Column 6.) Israel blamed the Palestinians for initially breaking the brief cease-fire, and the two sides fought through the day. But the Israeli truce with Syrian forces appeared to be holding. (A1:3.)

The Bank for International Settlements, warning that the world economy is now ''in a highly unstable situation,'' is urging the United States to relax its tight monetary policy in order to lower interest rates and stop the ''near stagnation of the industrial economies'' from turning into ''a real slump.'' But a relaxation of monetary controls by the United States, the bank says, must be accompanied by steps to prevent an upsurge in inflation; these steps should include cuts in the budget deficit and curbs on wage increases. In addition, the B.I.S., often known as the ''central bankers' central bank'' because it is owned by the major Western central banks, wants the United States to intervene more actively on foreign exchange markets to stabalize the dollar and to encourage private banks to continue lending to the developing world. The B.I.S.'s prescriptions for the United States, which apply to most other industrial countries too, are part of a general strategy for lowering interest rates and promoting economic recovery, without sacrificing the gains made in the fight against inflation. The strategy is outlined in its latest annual report, which is to be released Monday in Basle, Switzerland, the bank's headquarters.

King Khalid of Saudi Arabia, ruler of the desert oil nation since 1975, died today of a heart attack in the mountain resort of Taif. The King, 69 years old, was succeeded by Crown Prince Fahd, 59, a half-brother. Although he had been in ill health for years, the King's death was unexpected. On Saturday the ruler was shown by Saudi television arriving in Taif to spend the summer. The change in rule came at an awkward time for Saudi Arabia. The country has been a staunch supporter of Iraq, which now appears to be losing its war against Iran. Saudi Arabia has also been active in trying to restore peace in Lebanon, where fighting continues a week after Israel's invasion.