I am in the slums, near the Planar Sphere, but near it, there is a beggar who is in red and at night there is a landlord as well that is red? is this some sort of bug, beause while I was talking to th guy trying to sell the PS, somehow edwin killed the beggar and suddenly I'm no longer a Paladin. Its cooky.

I think it is part of a quest...but i am not sure..
I am sure some of or other forum members will asnwer your Q

This has never occured to me. I don't think there is a quest related to this, but maybe you have harmed somebody of the "civilians" in this area as a side effect of a fight or spell. This could turn other NPCs on the map hostile. As you're playing a paladin I assume it's not a low reputation problem, which could also turn others hostile IIRC. You should go back to an earlier save or simply leave the area if you don't have to return there.
Good luck.

Immediately go back to your oldest Save. If this was before people turned Hostile to you, thank the gods and your lucky stars, because being a Fallen Paladin sucks. If, however, you made the poor choice of Saving your game after suffering this fall from grace, I have heard that there is a way to have your "Fallen" status revoked, and it involves the magic words "Paladin Stronghold." (I've never Fallen myself, so I can't really claim that the thing actually gets you your original class/kit back.)

The most logical cause of this is, as Azaghal said, that you harmed or offended some Innocent character (by Failing a Pickpocket, opening a Locked container in their home, hitting somebody with an Area-of-Effect spell). Whenever that happens, all "Innocent" characters will turn Hostile to you, and stay that way for the rest of their lives.

No. If I had tried to pickpocket the beggar and got caught, they all would have been red, but its only that one beggar, except at night when its also a landlord. And I have already done the stronghold.

I know this problem must have been solved by now but I think the reason that they are red is due to infravison. I could be wrong or did you mean thier circle was red?

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Drizzt Do'Urden
BG1 Theme

I am pretty sure The Lilarcor meant that the circle is red.