Report Creation - Problem

Report Creation - Problem

I am trying to create custom reports in the Report tab and cannot. Only (2) reports show up:
Forecast Reports
Quarterly Forecast Summary
Forecast History Report

I cannot create or save new reports. I did create a custom folder, but can't create reports. Am I missing something or is there a problem (I am using the "On Demand" web-based product).

P.S. I think that CRM is a great product overall!!!! :)