Tanespimycin and Cytarabine in Treating Patients With Relapsed or Refractory Acute Myeloid Leukemia, Acute Lymphoblastic Leukemia, Chronic Myelogenous Leukemia, Chronic Myelomonocytic Leukemia, or Myelodysplastic Syndromes

Inclusion Criteria: Diagnosis of 1 of the following: Acute myeloid leukemia, except acute promyelocytic leukemia (M3 disease), meeting 1 of the following criteria: Failed to achieve complete remission (CR) after initial induction therapy regimen* First relapse within 1 year of initial CR Failed re-induction therapy at first or second relapse Second or third relapse after completing ≤ 3 different induction therapy regimens Antecedent hematologic disorder (myelodysplastic syndromes [MDS], chronic myeloproliferative disease, or chronic myelomonocytic leukemia [CMML]) Received prior chemotherapy for a non-hematologic malignancy High-risk cytogenetic abnormalities (abnormalities of chromosome 5, 7, 8, or 11 OR ≥ 3 karyotypic abnormalities) Acute lymphoblastic leukemia, meeting 1 of the following criteria: Failed to achieve CR after initial induction therapy regimen First relapse within 1 year of initial CR Failed re-induction therapy at first or second relapse Second or third relapse after completing ≤ 3 different induction therapy regimens Chronic myelogenous leukemia, meeting the following criteria: Accelerated OR blast phase (> 10% increase in the blast percentage in bone marrow) Failed prior imatinib mesylate No more than 1 prior chemotherapy regimen in addition to imatinib mesylate CMML, meeting the following criteria: More than 10% increase in blast percentage AND organ infiltration OR impending marrow failure as evidenced by cytopenia No t(5;12) by cytogenetics (unless failed prior trial of imatinib mesylate) High-grade MDS, defined as > 10% blasts on marrow cellularity (refractory anemia with excess blasts in transformation) OR International Prognostic Scoring System MDS prognostic score > 1.5 Not a candidate for allogenic bone marrow transplantation* from a related sibling donor (i.e., HLA-identical sibling) No known standard or potentially curative therapy exists or is capable of extending life expectancy No clinical symptoms suggesting CNS leukemia Performance status - ECOG 0-2 At least 60 days See Disease Characteristics Bilirubin ≤ 1.5 times upper limit of normal (unless attributed to underlying disease) Creatinine clearance ≥ 60 mL/min No New York Heart Association class III-IV heart failure No myocardial infarction within the past year LVEF ≥ 40% by MUGA No cardiac symptoms ≥ grade 2 No uncontrolled dysrhythmia requiring medication No poorly controlled angina QTc ≤ 450 msec for men and ≤ 470 msec for women No congenital long QT syndrome No left bundle branch block No ischemic heart disease within the past 6 months No history of cardiac toxicity after treatment with anthracyclines (e.g., doxorubicin hydrochloride, daunorubicin hydrochloride, mitoxantrone hydrochloride, bleomycin, or carmustine No other significant cardiac disease No active uncontrolled infection No history of serious allergic reaction to eggs No known HIV infection or AIDS (with or without highly active antiretroviral treatment) DLCO > 80% No pulmonary symptoms ≥ grade 2 No symptomatic pulmonary disease requiring medication including any of the following: Dyspnea on or off exertion Paroxysmal nocturnal dyspnea Significant pulmonary disease (e.g., chronic obstruction/restrictive pulmonary disease) No oxygen requirement No home oxygen that meets the medicare requirement No history of pulmonary toxicity after treatment with anthracyclines (e.g., doxorubicin hydrochloride, daunorubicin hydrochloride, mitoxantrone hydrochloride, bleomycin, or carmustine Not pregnant or nursing Negative pregnancy test Fertile patients must use effective contraception No psychosis No other serious underlying medical condition that would preclude study participation No prior allogeneic or autologous bone marrow transplantation No concurrent immunotherapy No concurrent biologic agents No concurrent gene therapy See Disease Characteristics Recovered from prior chemotherapy At least 48 hours since prior hydroxyurea for prevention of leukostasis No other concurrent chemotherapy At least 48 hours since prior glucocorticoids for prevention of leukostasis No prior radiotherapy that included the heart in the field (e.g., mantle) or chest No concurrent radiotherapy No concurrent drugs that may cause QTc prolongation No concurrent participation in another clinical trial involving a pharmacologic agent for symptom control or therapeutic intent No other concurrent investigational drugs or therapy