Page nav broken

<?php get_header(); ?><?php get_sidebar(); ?>		<ul id="navlist">		<li><a href="/">Home</a></li>  		<li><a href="<?php bloginfo('url'); ?>" id="current"> Blog Home</a></li>		<li><a href="<?php bloginfo('url'); ?>/about" >About</a></li>		<li><a href="<?php bloginfo('url'); ?>/archive-index" >Archives</a></li>		<li class="last"><a href="<?php bloginfo('url'); ?>/contact">Contact</a></li>	</ul> 	<div id="content" class="narrowcolumn">       <?php query_posts('posts_per_page=2'); ?>		<?php if (have_posts()) : 		$i = 1; ?> 				<?php while (have_posts()) : the_post(); 						if ($i == 1) { ?>				<img src="<?php bloginfo('template_directory');?>/images/fresh.gif" id="fresh" alt="Newest Post" title="This post is guaranteed to be freshly published"/>			<?php }			?>						<p class="date"><?php the_time('F jS, Y') ?></p>			<div class="post" id="post-<?php the_ID(); ?>">							<?php if ($i == 1) { ?>					<h2 class="posttitle" id="firstpost"><a href="<?php the_permalink() ?>" rel="bookmark" title="Permanent Link to <?php the_title(); ?>"><?php the_title(); ?></a></h2> 				<?php }					else { ?>					<h2 class="posttitle"><a href="<?php the_permalink() ?>" rel="bookmark" title="Permanent Link to <?php the_title(); ?>"><?php the_title(); ?></a></h2>   					<?php } ?>								<div class="entry">					<?php the_content('Continue reading...'); ?>				</div>						<p class="postmetadata">				Posted by <?php the_author() ?> on  <?php the_time('l, F jS, Y') ?> 				<?php comments_popup_link('No Comments', '1 person had their say', '% Comments','comments'); ?> 				<a href="<?php the_permalink() ?>" rel="bookmark" class="permalink" title="Permanent Link to <?php the_title(); ?>">Permalink</a> 				</p>					</div>									<?php				$i = $i + 1;				endwhile; ?>				<div class="navigation">			<div class="alignleft"><?php next_posts_link('&laquo; Older entries') ?></div>			<div class="alignright"><?php previous_posts_link('More Recent entries &raquo;') ?></div>			</div> <!-- end navigation -->							<?php else : ?>		<h2 class="center">Not Found</h2>		<p class="center">Sorry, but you are looking for something that isn't here.</p>		<?php include (TEMPLATEPATH . "/searchform.php"); ?>	<?php endif; ?>	</div><?php get_footer(); ?>