Falcon Heene, the 6-year-old boy once thought to be trapped in a hot air balloon floating over Colorado, has been found. Hidden in a box in the attic of his family's garage, Heene reportedly thought he would get in trouble for playing inside his father's meteorological balloon, for which he had been reprimanded early Thursday morning. When Falcon's brother Bradford told his parents Falcon was "in the balloon" again that afternoon, Falcon reportedly fled and hid to avoid punishment. Shortly thereafter, the balloon escaped—leaving parents Richard and Mayumi Heene fearing their third and youngest son had been spirited away in the silver orb. The balloon was adrift for two hours, capturing the attention of a concerned and fascinated public; when it landed, authorities opened it up and found the balloon to be empty. It is unclear how the balloon escaped the Heene yard, although questions about the innocence of the debacle have been raised—Perez Hilton notes that, under pressure, the boy blurted "It was for the show" on live television. Richard Heene is a former meteorologist and storm chaser. The Heene family appeared on the ABC program Wife Swap in an episode where Mayumi Heene traded maternal roles with a psychic.

Conservative Tea Party activists are energizing the Republican Party, but all that enthusiasm comes with a price: They may be scaring away the moderates that would help the GOP retake the House in 2010. With a shaky economy, a controversial health-care plan, and uncertainty in Afghanistan, the Republicans should have a good chance to win back seats from Democrats. But some of the candidates the party thinks have the best shot at winning seats back from the Dems are deeply unpopular with teabaggers. GOP leaders were thrilled Florida Governor Charlie Crist agreed to run for the Senate, but he’s reviled by conservative activists for supporting President Obama’s stimulus package. And in the only congressional race this November, a pro-choice Republican candidate hoping to hold a GOP seat in upstate New York is being challenged by a Tea Party favorite, who has siphoned off enough support from his moderate rival that a Democrat is now in the lead. "It's healthy to have debates about the future direction of the party," says a spokesman for the GOP senatorial campaign committee. But, he adds, "We want to make sure we have candidates on the ballot in the best position to defeat the Democrat candidate."

President Obama made his first presidential visit to New Orleans on Thursday. "I promise you this," Obama said during his first visit to the city as president, "together we will rebuild this region and we will build it stronger than before." He called for the repair of sewers and roads that have been damaged since Hurricane Katrina, as well as the reopening of houses, hospitals, and schools.

An interracial couple was denied a marriage license by a Louisiana justice of the peace, Keith Bardwell, who said he turned them down out of concern for their potential children. Bardwell said he wasn’t racist and had done ceremonies for black couples in his house; he explained that his decision to deny a license to Beth Humphrey, 30, and Terence McKay, 32, of Hammond, Louisiana, was based on his personal observation that neither white nor black families are accepting of interracial kids. He also thinks interracial marriages don’t last. The ACLU is preparing a letter to the Louisiana Supreme Court seeking to get Bardwell removed, because “He knew he was breaking the law, but continued to do it,” an attorney for the group said. But Bardwell says he’s just putting the kids first: “I don’t do interracial marriages because I don’t want to put children in a situation they didn’t bring on themselves,” Bardwell says, adding that if he did one interracial marriage, he’d have to do them all. “I try to treat everyone equally.”

Worst. Payday. Ever. Ken Lewis, the outgoing CEO at Bank of America, will receive none of his salary for 2009, and has even agreed to return $1 million of his past earnings. Still, no one’s likely to shed any tears for Lewis over the deal—his retirement awards are reported to be worth between $69 million and $200 million. The ruling came from Kenneth Feinberg, the U.S. Treasury’s pay czar appointed to deal with large companies after the stimulus. It has been widely speculated that Feinberg would cut back on CEO compensation, but never that he would revoke an entire year’s pay, and the move will likely be seen as a bellwether for the Treasury’s approach to companies that received significant government aid from the recent stimulus package. Lewis has reportedly agreed to the deal: “He felt it was not in the best interest of Bank of America for him to get involved in a dispute with the paymaster," said a spokesman.

A pair of deaths in a Sedona-area sweat lodge last week are being treated as homicides, Yavapai County Sheriff Steve Waugh announced Thursday. The deaths of Kirby Anne Brown, of New York, and James Scott Shore, of Wisconsin, occurred during a cleansing session in Oprah-approved self-help guru James Arthur Ray’s event at the Angel Valley Retreat Center. About 20 sweat lodge users were hospitalized after a crowd of 60, all crammed into the sweat lodge, mysteriously fell ill. The participants were partaking in a multiday health and mindfulness retreat. There is still no explanation for why so many fell ill during the Arizona ceremony.

Can giving $250 to 57 million seniors, veterans, and people with disabilities help ease the pains of the recession? Obama urged Congress to approve a one-time payment to Social Security recipients as a way of helping "those hardest hit by this recession." Because Social Security increases are pegged to inflation, which was negative this year, this would be the first time since 1975 that recipients have not received a cost of living increase. Predictably, seniors' groups welcomed the proposal, which would amount to about 2 percent of the benefits of an average Social Security retiree, while Sen. Judd Gregg (R-NH) called the program "inappropriate." Obama said the program, which would cost $13 million, would not further erode Social Security's finances, although he did not offer alternatives to finance the program.

There seems to be growing evidence that Cameron Todd Willingham—who was executed in Texas in 2004—was innocent, but Texas Governor Rick Perry is bunkering down. “Willingham was a monster,” Perry told the Associated Press on Wednesday. Perry himself is becoming subject to pressure, as he recently removed three people from a panel set to review Willingham’s case 48 hours before they were to begin, forcing the review’s cancellation. The ousted head of the Panel is now saying that he faced pressure twice from Perry’s lawyers to ditch the review.

Will they drink it from micro-cups? Microblog service Twitter is making a foray into viticulture with a wine label: Fledgling Wines. A joint project with San Francisco DIY winery Crushpad and nonprofit literacy organization Room to Read, proceeds from Twitter’s two wines—a Pinot Noir and a Chardonnay—will go toward promoting child literacy in the developing world. SF Weekly reports that, “true to the open nature of its own product, Twitter is not creating the wines all on its own: It’s encouraging you to participate in the process” with “virtual” barrel tasting and a possible label-design contest. Crushpad is a company that provides means for amateur oenophiles to make and sell their own wine. Like Twitter, it’s one of the Bay area’s promising young startups, having raised $9 million in funding since 2004, mostly from its customers.

After being lambasted by the media for her disastrous debut as the creative consultant for Ungaro at Paris Fashion Week, Lindsay Lohan acknowledges she has a way to go before she becomes the next Karl Lagerfeld. “I am learning,” she told People at a Victoria’s Secret Velvet launch party in New York on Wednesday, where she admitted she was as shocked as the audience when models on the runway revealed sequined pasties. “I wasn’t aware of the nipple tassels on the girls until they were walking out,” she said. She blamed the situation on “coming in so late and having not that much time to do a whole collection” and said she intends to head back to Paris to show a new collection. But will her next line be better than the last, which Women’s Wear Daily proclaimed was “an effort that was, quite simply, an embarrassmen"? Only time will tell—and she doesn’t have much of it. “It’s already in January,” she said. “I thought it was in March.”

Alan Greenspan thinks the Fed is making a mistake. The former Federal Reserve chairman said Thursday that former Treasury Secretary Hank Paulson’s decision to bolster “too big to fail” institutions like Fannie Mae and Freddie Mac, and to bail out banks was a bad one. “If they’re too big to fail, they’re too big,” Greenspan said. “In 1911, we broke up Standard Oil—so what happened? The individual parts became more valuable than the whole. Maybe that’s what we need to do.” Greenspan’s dissent sharply contrasts with the current Fed leadership and the Obama administration’s strategies for rescuing Wall Street. Though Greenspan says “arbitrarily breaking down organizations into various different sizes” violates his philosophical leanings, “If you don’t neutralize that, you’re going to get a moribund group of obsolescent institutions which will be a big drain on the savings of the society.”

Might the Jon and Kate drama—dare we say it—finally be over? The dueling couple might stay in the news, but their children will stay off of television: Jon & Kate Plus 8 will stop filming new episodes next month, according to the New York Post. Jon Gosselin recently forbade TLC from filming his eight children for the show, and the network will eke out a few more episodes before the show finally concludes in November. Kate—who says the kids have been teary-eyed since the film crews left and that she needs the income from the show to survive—has had no comment. Jon has said he wants the filming to cease because he recently had an epiphany and realized the show was harming his kids—not because he wasn’t to be included in an iteration of the show titled Kate Plus 8. Even if Jon changes his mind about filming, it’s unclear if TLC would restart the show.

Democratic New York State Senator Hiram Monserrate was acquitted of felony assault charges on Thursday but found guilty of a misdemeanor for dragging his girlfriend down a hallway, in a verdict rendered by Queens Supreme Court Judge William Erlbaum. Monserrate, on trial for a December 2008 incident where he was alleged to have shoved broken glass into the face of his girlfriend, Karla Giraldo, would have lost his state Senate seat and created an even less stable balance of power in the body, where Democrats have a two-seat majority. Assistant DA Scott Kessler relied heavily on the testimony of the emergency-room doctor who claimed that Giraldo had told her that the injury was “no accident”; Monserrate’s lawyer, Joseph Tacopina, argued that Giraldo had been drunk and the whole incident was an accident.

Supreme Court Justice Ruth Bader Ginsburg was hospitalized overnight after she grew drowsy and fell from her seat aboard an airplane on Wednesday night. Ginsburg was flying to Britain along with justices John Roberts, Stephen Breyer, and Antonin Scalia in order to participate in ceremonies making the opening of Britain’s new Supreme Court. Breyer got off the plane with Ginsburg, and made it to London eventually on a later flight. It was the second hospitalization for Ginsburg in the last month. She was released from the hospital on Thursday morning.

Sure, she lost the battle for the 2008 Democratic presidential nomination, but now Hillary's on top in the popularity war. According to a new Gallup poll, the secretary of State enjoys a higher favorable rating than Barack Obama. In January of 2009, Obama and Clinton enjoyed favorable ratings of 78 percent and 65 percent, respectively, while in October, Obama's rating plummeted to 56 percent, and Hillary's slid down to 62 percent. The poll was taken before President Obama won the Nobel Peace Prize which could, for better or for worse, affect current popularity levels. The Hillary trend held clear across party lines, with the secretary of State barely beating out Obama among Democrats and Independents, but bulldozing him—35 percent to 19 percent—among Republicans.

If Warner Bros. was hoping for a big family hit with the $90 million adaptation of Where the Wild Things Are, they may want to think again. “Spike Jonze has … created an arthouse film about childhood that had our family-filled audience buzzing with chattering, bored children,” writes Massawyrm at Ain’t It Cool News. Massawyrm writes that the film’s arthouse tendencies are “lyrical” and “beautiful,” but that as a “fun adventure film” it’s an “absolute failure”: “Anyone looking for a good time has signed on for the wrong boat ride to the worst possible island.” The film is “beautiful to see,” the review ends, but “not powerful or moving enough to recommend. … I wanted to love it, I really, really did, but I was just too bored to.”

Don’t throw out that library card just yet. The age-old institutions are holding onto familiar users and gaining new ones by expanding digital collections, seizing readers' newfound appreciation for electronic readers. More than 5,000 public libraries across the country now offer ebooks, Motoko Rich reports in Thursday's New York Times. An official at the Boston Public Library said, “People still think of libraries as old dusty books on shelves, and it’s a perception we’re always trying to fight. If we don’t provide this material for them, they are just going to stop using the library altogether.”

Goldman Sachs announced Thursday that its profits jumped to $3.19 billion in the third quarter, nearly quadruple what they were a year ago. The spike was driven by returns on corporate investments and trading revenues. What will Goldman do with all that good fortune? For starters, it's set aside $5.35 billion for compensation and benefits, setting the company on track for record end-of-year payments to executives. Despite the fact that Goldman repaid its $10 billion bailout in June, the executive payments may draw scrutiny from lawmakers and ire from the public, as the debate continues on whether Wall Street's culture of bonuses contributed to the financial collapse. Meanwhile, Citigroup logged a more modest $101 million profit, still remarkable considering that it had been expected to post a loss.

Madonna admits she still doesn’t have an ear for what new songs will be hits, even after almost three decades in the music industry, in her cover story in Rolling Stone. “I’ve never been a good judge of what things are going to be huge or not. The songs that I think are the most retarded songs I’ve written, like ‘Cherish’ and ‘Sorry,’ a pretty big hit off my last album, end up being the biggest hits… ‘Into the Groove’ is another song I feel retarded singing, but everybody seems to like it.” In the far-ranging interview, the singer discusses her eight-year marriage to Guy Ritchie (“challenging”), her evolving style (“a lot less calculated than people think”), and Lady Gaga (“she has that It Factor”).

The New York Times Co. said Wednesday that it will not sell The Boston Globe after all, ending months of uncertainty about the future of New England's largest newspaper. Throughout the spring and summer, The Times had been exploring offers for the paper, its Web site, and another regional paper. Two such offers arrived Friday, and yet the company's top brass told workers that they've decided to stick together. It seems there was a price for the hemorrhaging newspaper property that was too low for Arthur Sulzberger Jr., who turned down bids that valued the Globe at $35 million and promises to take on another $59 million in unfunded pension liabilities.

The wave of terror continues: About 25 Islamic militants struck three separate security sites in the Pakistani city of Lahore Thursday, while two other cities reported suicide bombings. At least 39 people have died in the latest strike, including at least 19 police officers and 13 militants. Pakistan's Taliban movement claimed responsibility for the assault. In the past six days, at least 120 people have been killed in four major terrorist attacks. The jump in violence comes as Pakistan's security forces plan to pursue the Taliban in South Waziristan near the Afghan border.

British Prime Minister Gordon Brown announced on Wednesday that he will send more troops to Afghanistan, stepping into an uncomfortable debate between President Barack Obama and his commander for the area, General Stanley McChrystal. At the moment the White House is debating whether or not a troop increase is necessary, Brown's decision takes a firm stance towards escalation. British officials told The Wall Street Journal that Brown has found "a lot of common ground" with McChrystal, although Downing Street is careful to say that they don't intend to interfere with the American policy debate. Brown will send an additional 500 troops to Afghanistan, bringing the British contingent to 9,500. The Americans have 68,000 there and McChrystal is advocating for 40,000 more.

The Senate Finance Committee’s health-care compromise won over one Republican, but labor unions are rallying against the bill, criticizing it as “deeply flawed” because it lacks a public-insurance option and taxes expensive health-insurance plans. The AFL-CIO and several of its affiliates bought ads in major newspapers that argued that a government plan is needed because it would keep costs down by competing with big insurers. The unions threatened to oppose the legislation unless changes are made to the final bill, and they’re worried that the president might sign a bill without the public option. An AFL-CIO lobbyist said he’s “optimistic the bill is going to improve.” But the president of another union, AFSCME, was harsher: "We worked like hell in 2006 to have the House go Democrat. We worked in all the other years for Democrats. Now we've got a Democrat in the White House and we expect some positive things.” Labor groups oppose taxes on health-care benefits because they’ve forgone higher wages in exchange for better benefits.

Rush Limbaugh's dream of owning an NFL team is over. CNN reports that sports mogul Dave Checketts, ringleader of the group bidding on the St. Louis Rams that Limbaugh belonged to, released a statement Wednesday announcing that the radio jock would not continue as a limited partner in their group. "It has become clear that his involvement in our group has become a complication and a distraction to our intentions; endangering our bid to keep the team in St. Louis. As such, we have decided to move forward without him," Checketts said. For the group to successfully purchase the Rams, three-quarters of the NFL's 32 other owners would need to approve their bid—and the radio host's myriad enemies and racially charged history were proving to be a liability. Limbaugh had remained stalwart in his bid to the bitter end, announcing early this week, "I am not even thinking of exiting"—but ultimately the decision wasn't up to him.

Proceedings in the first criminal case involving Wall Street bankers' behavior during the credit crunch opened in Brooklyn, N.Y. Wednesday, where former Bear Stearns hedge-fund managers were accused of defrauding investors and lying "over and over again" to steal $1.6 billion. "These two defendants lied to their investors to save their multimillion-dollar bonuses," the prosecutor said. "In the United States of America, that is a crime. It's a serious crime and it's called securities fraud." The men, Ralph Cioffi and Matthew Tannin, profess innocence. Their crashing funds ultimately contributed to the collapse of the 85-year-old brokerage firm.

Jon Bon Jovi will be “artist in residence” for NBC Universal over the next two months. In an unusual bid to promote his new album, The Circle, due November 10, the singer will appear exclusively on shows owned by the entertainment company, like the Today show, Saturday Night Live, and NBC Nightly News. Bon Jovi explained that “in a shrinking media environment, you have to kind of reinvent the wheel,” so he proposed the idea to NBC’s chief executive, Jeff Zucker, after his manager pitched it. The news story will focus on Bon Jovi’s philanthropic work in a segment called “Making a Difference,” and an interview on Bravo’s Inside the Actor’s Studio will cover the history of the band. NBC indicated that having artists in residence would be a recurring feature on its broadcast and cable channels.

The men at the stock exchange got to wear their 10,000 hats and market watchers cheered that the magic number of 10,000 for the Dow Jones industrial average was passed yesterday for the first time in a year. But who made it happen? The Washington Post reported Thursday that individual investors sat out the recent rally. While large pension-fund managers and hedge-fund owners are cheered by the charge, mom-and-pop investors remain on the sidelines. In fact, financial planners tell the paper, only very recently have individual investors begun to take notice. Said one: "For the first six months of the year, people just had their heads down. I don't know how many people told me they haven't looked at their statements."

Prison life has been rough for eccentric alleged Ponzi schemer Allen Stanford, who was still suffering the wounds of a jailhouse brawl when he began spitting up blood during a court appearance on Wednesday. The Houston judge interrupted Stanford's lawyer to ask "Is your client OK?" and Stanford nodded and waved off a court officer who offered help. Despite being held in solitary confinement, Stanford suffered serious injuries from his brawl. Nonetheless, Stanford used Wednesday's hearing to decline a speedy trial; the judge agreed to stall another 60 days before setting a trial date to give Stanford's lawyers time to pore over more than 400 million pages of documents associated with the case.

Move over fellas, it's time to let women take the reins. The Washington Post's Kathleen Parker has advice to Republican Party leaders Thursday, after having noticed a host of women who have stepped forward to move the party ahead. "In the past few months, several conservative women have emerged as candidates and critics to challenge the notion that the GOP is the party of men. They're also putting to rest any thought that Sarah Palin is the female face of the party," Parker wrote. Who might the next candidates be? Meg Whitman and Carly Fiorina out in California. Also catching Parker’s attention are Liz Cheney and The Daily Beast's Meghan McCain.

Barack Obama visits New Orleans Thursday for the first time since taking office, in a several-hour stopover during which he'll hear from residents struggling to rebuild their city after Hurricane Katrina ravaged it in 2005, killing about 1,600 people and doing $40 billion in damages. Although locals criticized the Bush administration for dragging its heels on reconstruction after the storm, so far, Republican Louisiana Gov. Bobby Jindal has hailed Obama's efforts in the region. Since Obama took office, 76 of the 120 reconstruction projects stalled in federal-state disputes have been resolved and the administration has made 18 trips to the city and 35 overall trips to the Gulf Coast since March. Finally, Obama's federal government has committed an additional $1.4 billion in federal aid to Louisiana and $150 million more to Mississippi.