It could be argued that the prevailing literary mode in the world is something that's never really caught on in America. It's ,, called magic realism, and its ascendancy signifies the rise of Latin America as the source of much late 20th-century literature.

Though set in a recognizeable world, it's still a world shimmering with the supernatural. Dogs talk and people have green hair. Ghosts hover in the near distance. The most lugubrious coincidences rattle through plots front-loaded with melodrama and happenstance, but in a way that signifies the author isn't stupid so much as ironic.

In some American precincts, there does seem to be a bit of a taste for this: Two years back, "Like Water for Chocolate" -- magic realism par excellence -- became a major art house hit, combining those same elements and adding food and sex.

On the other hand, magic realism often fails to touch audiences. As Richard Pena, head of the New York Film Festival, says, "In the past 20 years, the word 'magic realism' has sometimes been as much poison as it has been attraction. The idea of transferring that very literary quality to the screen has proved quite daunting to many directors."

Now a magic realist work on a major scale reaches us -- on Friday, when "The House of the Spirits" arrives.

To break even, this multimillion-dollar film has got to do more than art house business. It's got to beguile the masses. Perhaps that's why Miramax, the studio that's footing the bill for the work, recently convened a major junket for writers and critics in order to make certain the film is heralded as a major event.

And when you look at the project, you think: greatness, pure and simple.

Jeremy Irons, Meryl Streep, Glenn Close, Winona Ryder, Antonio Banderas, Vanessa Redgrave. Has there ever been such a cast? The source novel is the beloved world-wide best seller by Isabel Allende. The director and screenwriter is the revered Dane Bille August, he of "Twist and Shout," "Pelle the Conqueror" and "The Best Intentions."

How could they go wrong?

"I read Isabel's book five years ago," says August, "and I immediately fell in love with the story and wanted to be part of it. What I saw in the book was that it was so visually written. And what I like so much about the story was the combination of realism and supernatural powers and magic elements. And it was a very strong family story, and it was a story about a country and it was fun, and -- it had nightmares."

Allende's book is set in an unnamed country, but her own background supplies the name: She, after all, is the niece of Salvador Allende, the popularly elected leftist president of Chile who in 1973 was murdered in a bloody coup that hammered the country into a military dictatorship for another two decades.

It's the haunted tale of the Trueba clan, a sort of microcosm of Chilean society and history. It shows, in the words of Jeremy Irons, its star, "how a pioneer becomes viewed as being right wing. I think it's a universal story about politics, about family relationships, emotional relationships and their bearing upon political situations. It allows you to see the face of the torturer and understand why he's there and who he is. I think all those things are universal things."

Young Esteban -- Irons plays the part from 25 till 80 -- goes to the interior and, with hard and brutal work, builds himself a huge estate, a cattle ranch. Betrothed to the legendary beauty Rosa del Valle, eldest daughter of the politically progressive Del Valle clan, he is shattered when she dies, accidentally poisoned by reactionary forces who meant to kill her father.

Years later, Esteban marries her young sister, the clairvoyant Clara (Meryl Streep). They have a child, work their land and prosper in the grand aristocratic tradition. But as time passes, Esteban feels his power threatened and becomes more angrily conservative. When his daughter (Winona Ryder) falls in love with a young peasant firebrand (Antonio Banderas), he helps the military plot against a liberal government attempting land reform. The counter-revolution engulfs him with its unforeseen and violent consequences. Finally, as an old man, he tries to undo the wrong he's done by performing an act of heroism to spare the children he loves so much.

"It was a question of balance," says August. "Because it is very complicated to combine supernatural powers with very strong realism. When the tone shifts so violently from the fable-like quality to the harshness of the coup, it's a way to invite the audience in and show them how swiftly reality changes. It was done with purpose."

August characterizes the story as being "about a man who makes a lot of mistakes. He thinks he has the right. But in the end, he makes atonement. He is a human being, and he has both the power to forgive and the right to be forgiven."

Allende says, "When I thought of 'The House of the Spirits' as a movie, I always thought of it as something like 'Fanny and Alexander,' with little touches of magic realism like that picture has, but very grounded. And I also thought the Scandinavian cool approach would be great to subdue the Latin melodrama that my books have."

She also understands the difference between the mediums, how the film is literal and the book metaphorical.

"I have a character with green hair in the book. If he is in the movie, you have to choose what color the wig will be. Will it be apple green, copper green? Which kind of green? And it will always look like a wig. It looks silly. It works in the book because reading is such a private experience. There you are alone with the reader, and you can somehow convince the reader to make this unbelievable story believable. But in movies you sit there and you have a blunt image, and there's no way it will work."

She added, "I think that Bille achieved something that I never could for myself. Because if you had asked me before the movie was made what the book was about, I couldn't say, because for me all the stories have a level of importance. However, Bille was able to get from the book the main story, the main characters and tell the story, eliminating all the sub-stories without losing the spirit of it. So when I saw it, I could finally tell my children what it was about!"

Irons never doubted what it was about. He says, "I spend a lot of my time looking for stories that I think will work on the screen and that I want to be part of. Therefore I look for fresh characters. And when I read Bille's script, before I'd read Isabel's book, I liked not only the epic breadth of the story but the fact [that] it took me, the reader, somewhere that I'd never been. And yet at the same time taught me a lot about my condition as a person in England and America. I thought, this is a great story to tell, and if you get the film up and running, please consider me for Esteban."

With all that star power, how could the movie fail? Well, it has its doubters. Some have assailed its "soap opera" quality.

"I think I made the right choice in the way I told the story," says August. "I disagree with the soap opera criticisms. It is a different kind of expression. It's about South America, a more dramatic culture. But the most important thing is to communicate with the audience. I don't make movies for myself or for critics. I make them for audiences."

Adds Allende, "I think there is an underestimation of the audience. Hollywood thinks that the audience is dumb. And they are creating movies for commercial purposes. But I think there is a hunger for better scripts, good storytelling, for concepts more than just the thrill of entertainment."