Preheat oven to 300° . Remove any very dark crust from bread and break into small cubes. Combine 1 1/2 cups sugar, milk, 1 stick melted margarine, eggs and cinnamon. Pour over cubed bread in a large bowl and transfer to a greased 9 x 13-inch pan and bake 40 minutes. Combine 1/2 stick margarine, 1/2 cup sugar, water and flour in a saucepan. Bring to a boil and cook 3 minutes. Cool slightly; add vanilla. Pour sauce over warm pudding.