[Update (April 3, 2009): The two men who perpetrated this hoax have been charged by a local prosecutor as "disorderly persons", evidently a minor offense. Not surprising, and I'm sure it won't be a big deal. Still, don't try this at home, folks. Thanks to Kevin Conod for the tip.]
This story almost speaks for itself: by tying some long-lasting flares to helium balloons and releasing them, two skeptics from New Jersey made fools out local and national media, including the thoroughly awful "UFO Hunters" show on the increasingly ill-named History Channel.
I love this story! It has all the features told breathlessly in UFO reports: distant lights, flying in formation, appearing to hover, then suddenly taking off. All of this from flares tied to a balloon! My favorite part was testimony from a pilot (who claimed on camera the lights shot off to the side), because UFO experts love to trot out pilots, saying they spend so much time looking at the sky there's no way they could be mistaken.
Look: anyone can misidentify stuff in the sky, especially when what you're seeing doesn't fit into what you're used to. It's happened to me, and it's happened to lots of folks. Whenever some so-called "expert" says that there's no way flares could behave this way... well, you'll know better.
Not everything that glisters is gold, and not every light in the sky is an alien just dying to eat the back end of a cow or poke you in the privates. That's the kind of thing you'd hope people would have figured out by now, but this story proves conclusively that we'll have to keep saying it forever.