Hot rumor. Jimmy Carter was going to appear at O'Neal's Baloon last night for a drink with House Speaker Tip O'Neill. Crowds lined the streets under a statue of Dante, who had his back to the Democrats. No one seemed inclined to analyze this at all.

"Listen, I hear the president is coming," an O'Neill staffer said to Mike O'Neal, owner of the restaurant.

"Whaddaya want me to do -- get a beer ready?" replied O'Neal.

It wasn't necessary. Carter never showed, but here's who did: Manhattan Borough President Andrew Stein, U.S. Treasury Counsel Peter Solomon, Sen. Jennings Randolph of West Virginia and Thomas P. "Tip" O'Neill III, Massachusetts lieutenant governor and son of the guest of honor. The younger O'Neill was also Ted Kennedy's New England coordinator.

"I think it's going to come together fine," he said of Carter-Kennedy reconcilation efforts. "Listen to me -- if Ted Kennedy wanted to hurt the party, he would have done it weeks ago."

Also in the crowd was New Jersey Gov. Brendan Byrne. He was being eyed by a woman from the East Side. "When you live as far out of town as Princeton," she said, gesturing toward the governor, "you can come to town in a seersucker suit and buckskins."

The party was attended by hundreds who wandered inside the bar and restaurant across from Lincoln Center, then outside on the sidewalk where tables had been placed. Police barricades separated the invitees from the non-invitees, who stood across the street and watched everybody else eat. This was really a party in a fishbowl.

Chefs carved giant legs of beef, a band played swing music and an ice sculpture in the form of a donkey rapidly melted into something akin to a beagle in the late afternoon sun.By 5:40 the donkey had lost its left ear. No analysis here, either. High Times

Maybe it was the altitude. Or maybe it was the alcohol. Yeah, it was probably the alcohol.

Certainly the bartenders were sweating like mule drivers.And the 500 Democrats packed like sardines in mustard sauce 107 floors up at Windows on the World were cackling, giggling, maybe even tickling each other. Hard business, these conventions.

The event: a reception for the Democratic House and Senate Council given by the Democratic Senatorial and Congressional Campaign committees.

The scene: blue, purple and forest-green silk dresses, dark business suits, red ties, crisp white shirts, wingtips, coconut-tasting hors d'oeuvres, a view of the Hudson and the haze.

The dialogue: "What are you doing here?" a certain Southern congressman said to a woman in a peach dress.

"Following you around," she replied.

"If you were doing that," he responded, "you'd be having the best time of your life."

A woman in a purple dress: "I go to parties, I go shopping all day long, and I am just exhausted. I plopped down on the bed last night and Stanley kept on trying to wake me up to go to a party, but I just couldn't . . . Oh, hello Stanley."

Stanley threw his arms around the woman in the purple dress and her companion, a young lady with blond hair and short fingernails.

"The prettiest girls in New York," said Stanley.

"Oh listen," said the woman in the purple dress. "I got a letter from my interior decorator today and I went over to go shopping on Madison Avenue and I saw the most beautiful furniture I have ever seen in my life. And then I went on over to the Valentino Boutique . . ."

Stanley is paying for all this.

Over by a ficus tree, you could find the mayor of Fresno, Calif., and his wife. "They're big in California," said the mayor, pointing to the tree. "People have them over their hot tubs."

"I'm not really his wife," said the woman, who is Kathleen Whitehurst.

"And I'm not really the mayor," said Daniel Whitehurst.

They were both lying.

The ballast of the crowd was composed of the representatives you can find at any midweek Capitol Hill fundraiser in Washington. Tip O'Neill was the reigning star. But Barbara Eden and Jason Robards were the real ones.

Robards is at wit's end politically. "Don't know who I'll vote for," he said. "I'll run myself, for Christ's sake." McCarthy -- More Than Ever

Number One Sutton Place South even smells expensive when you walk in. Marietta Tree lives there surrounded by peach-colored walls, Japanese silk screens, velvet footstools, books on Disraeli and lots of maids. Her credentials: former U.S. ambassador to the United Nations, sister to the former governor of Massachusetts, mother of Pulitzer Prize-winner Frankie FitzGerald, daughter of the founder of Groton, and old, old money.

Last night, she had friends over for mid-convention cocktails. One of them was Francoise de la Renta, wife of the designer. She wore her husband, so to speak. "It's very easy that I like him," she said, sweeping her arms along her white-and-black suit. "I don't have to shop."

She wandered in to find a group of guests dominated by longtime liberals, but with some exceptions. There were economist John Kenneth Galbraith, former senator Eugene McCarthy, columnist James Reston, Canadian Ambassador Peter Towe, advice columnist Ann Landers, assistant education secretary Liz Carpenter, Columbia Journalism School Dean Osborn Elliott, former New York mayor Robert Wagner, Sen. Thomas Eagleton, U.N. Ambassador Donald McHenry and Clayton and Polly Fritchie, the co-hosts.

Politics did not entirely dominiate the conversation, especially since the sound was turned off on a television tuned to NBC News. If you wanted to hear what Tom Brokaw was saying, you had to lip-read.

Spotted near a window that had a view of the Queensboro Bridge was a woman who wore a black button that said, "McCarthy -- More Than Ever."

"He's my date tonight," said the woman, Mimi Kazon, a columnist for the East Side Express.

But why McCarthy? she was asked.

"Because he called me up," she responded. The Cocktail Party Meatball

Mayor Edward Koch is as ubiquitous this week as the cocktail party meatball. "I've been to 25 parties in two and one-half days," he said last night at Gracie Mansion. "The way I do it is to drink club soda at the first 12, and then maybe loosen up with a glass of wine at the last one."

That statement was provided to the press at yet another affair at Gracie Mansion, this time a dinner for Jimmy Carter's Cabinet members and administration officials.

"Come on in and have dinner, will you?" the mayor said to his guests. He sounded like somebody's mother. The guests, who included Education Secretary Shirley Hufstedler, trade representative Reubin Askew, Joan Mondale and staff director for the first lady Kit Dobelle, ate cold salmon and salad, listened to an instrumental ensemble, and then were told they could either go back to Madison Square Garden or take a tour of the house.

"Have we made provisions to get you people to the Garden?" said the mayor. He looked at an aide. "Oh, he continued, "we have not. Well, we can't call you taxis." So a few people stayed for the tour, among them White House aide Al McDonald, and Bill Albers, a deputy assistant to the president.

The tour lasted maybe five minutes. "Little smaller than the White House," said Albers.