Mayor Bloomberg has a plan to improve life in the city: He's announcing that several sections of Times Square and Herald Square will be turned into car-free zones! Pedestrian malls will be set up in several areas with benches, café tables, and "colorful umbrellas." (An illustration of what's in store for Times Square is above.) Unfortunately, it's just an "experimental" program for the time being, and is only scheduled to run through the end of the year. But be sure to enjoy it while it lasts! "Colorful umbrellas" are always the first to go when another round of budget cuts come along.

It looks like Anderson Cooper messed with the wrong guy when he described Bronx Rep. Eliot Engel as "kind of pathetic" on CNN on Tuesday night. The congressman, who became the butt of Anderson's on-air joke after staking out an aisle seat more than 12 hours in advance of President Obama's address to Congress, now says Cooper is the one who is "really pathetic" for not sharing Engel's "enthusiasm for participating in such a historic and wonderful celebration of American democracy," and he says he's sorry that Cooper is "so jaded." Your turn, Andy! [NYDN]

The Revolution Is At Hand [Flickr]

More troubling news on the job front: The Labor Department reports that first-time requests for unemployment benefits jumped to 667,000 last week, which represents a 26-year high. [AP]

Author and Vanity Fair columnist Michael Wolff has been inescapable on the airwaves in recent days, ripping the Post, News Corp. and its chairman Rupert Murdoch to shreds for the Post's tasteless cartoon last week. Of course, Wolff has good reason to seek out the attention. His biography on Murdoch, which was published in December, has been a stunning failure: According to Bookscan, which tracks roughly 75% of the books sold in the U.S., The Man Who Owns the News has sold just over 15,000 copies since it was published in December, a far cry from what publisher Doubleday was expecting given he reportedly took home a $1 million advance and Doubleday indicated it would "start off" with a 100,000 print run. But while it's no surprise to see Wolff carry on about News Corp. (and his other pet obsession, the New York Times), it is a bit surprising to see Wolff invoking ethics and morals. Why, you ask? Perhaps because it's always a bit difficult to take an ethics lesson from a married man who carried on an affair with a woman nearly three decades his junior who also happened to be an intern at the magazine he writes for.

Bank of America CEO Ken Lewis will be sitting down with investigators from Attorney General Andrew Cuomo's office today as part of the probe into the $3.6 billion in bonuses that Merrill Lynch paid out just days before it was acquired by BofA. Lewis didn't indicate what time he was scheduled to give his deposition, although in typical Lewisian fashion, he made it sound like something he was thrilled to be doing: "I look forward to the chance to speak candidly and forthrightly and honestly and tell the story." But he may be in for a rude awakening when he turns up at Cuomo's offices today.

• Financier J. Christopher Flowers is putting his Upper East Side townhouse—known as the Harkness Mansion—on the market. It's "quietly being offered" for $49.95 million, which is a few million bucks less than what Flowers paid for the 50-foot-wide townhouse when he bought it from Jacqui Safra and Jean Doumanian in 2006. [NYO]
• Former Revlon CEO Jack Stahl has paid $8 million for a 21st-floor apartment at 255 East 74th Street. [Cityfile]
• Equinox founder Danny Errico and his wife Vera have sold their six bedroom, oceanfront mansion at 71 Shipwreck Drive in Amagansett for $11.895 million. [NYP]
• Manchester United manager Sir Alex Ferguson may be trying to back out of a deal to buy a three-bedroom penthouse at 200 East 66th Street. [NYP]

Erykah Badu turns 38 today. Billionaire philanthropist and political powerbroker Ron Lauder is 65. Right-wing commentator Bob Novak is turning 78. Town & Country editor-in-chief Pamela Fiori is 65. WABC anchorman Bill Ritter is 59. Virginia Governor Tim Kaine is 51. Stylist Mark Garrison is 58. Ally Hilfiger, the "designer" and daughter of Tommy, is turning 24. And Michael Bolton turns 56 today.

• Citigroup is close to a pact to boost the government's stake in the failing bank to as much as 40%; Vikram Pandit's job, however, should be safe. [WSJ, NYP]
• More on what the Obama administration is hoping to find out when it begins conducting the "stress tests" to see how banks hold up during a crisis. [WSJ]
• RBS has reported the biggest loss ($34.3 billion) in British history. [Reuters]
• Bank of America is considering a sale of First Republic Bank [WSJ]
• UBS has named Oswald Grübel as the company's new CEO. [FT]
• JPMorgan Chase will have eliminated a total of 12,000 jobs by the time it folds in the operations of Washington Mutual. [AP]
• Yet another massive financial fraud uncovered: Paul Greenwood and Stephen Walsh have been implicated in a $667 million scheme. [NYT]

• Is Madonna's relationship with Jesus Luz purely platonic? The two are "quite close and cuddly, but not exactly romantic," and Jesus was spotted at a Kabbalah service "playing around more with Rocco than paying attention to Madonna," which can't be a good sign. [E!]
• Did marrying Tom Cruise ruin Katie Holmes' chances of ever having a movie career? Is Tom's sister secretly handling his PR even though she pretends to just be his assistant? So many questions! [Fox 411, P6]
• Amy Winehouse's estranged husband Blake Fielder-Civil was released from jail yesterday. [The Sun]
• Martha Stewart's old friend Sam Waksal is now out of a halfway house and "ready to get back to work trying to find a cure for cancer." [NYDN]

"Demand for fake testicles for neutered pets, including dogs and cats, is also holding up during the recession. Southern California is the biggest market for Kansas City, Missouri-based Neuticles, said Gregg Miller, the company's founder. Its most expensive prosthetic testicles, for large dogs, cost $1,299. 'You would assume that with people losing their homes and jobs, the last thing on their mind is buying a pair of fake testicles for their pets,' Miller said. 'Folks in California love their pets and are trendsetters. They'd do anything for them, no matter what the economy is doing.'" [Bloomberg]

• Moises de la Renta—son of Oscar/ex-Phat Farm intern—is launching a clothing line. It's called MDLR; no points for figuring out what that stands for. [SF]
• Kevin Federline is launching a children's clothing line. He's currently attending a trade show in Las Vegas "in the interest of research," in case you happen to be looking for him. [WWD]
• Jenna Jameson is launching a fragrance. [NYDN]
• Michelle picked Narciso Rodriguez for Barack's speech before Congress. [SF]
• Roberto Cavalli isn't skipping Milan Fashion Week completely. And Victoria Beckham's headed to town, so the week is shaping up nicely. [FWD, WWD]
• A roundup of the worst fashion choices from The City! [Pipeline]

• Starting in 2010, all restaurants will have an inspection grade—a blue A, a green B or a yellow C—posted in the window. It's official: NYC is now LA! [NYT]
• The UWS branch of Fatty Crab opens next week. [GS]
• The John Dory begins brunch service this weekend. [TONY]
• A peek at Julian Schnabel's private dining room at the Old Homestead. [GS]
• Brooklyn's Buttermilk Channel gets a one-star in this week's Times. [NYT]
• Inakaya opens in Midtown tomorrow. [Eater]
• Chef Joël Antunes has "parted ways" with the god-awful Oak Room. [GS]
• Limelight may reopen as a store. (And, no, not a drugstore.) [NYO]
• Please excuse the Post's Steve Cuozzo. He's in a bad mood today. [NYP]

The Observer has a lovely little Q&A today with Jamie Drake, the interior designer best known for his work designing Mayor Bloomberg's 2,274 homes around the world. If you were hoping for some info on the dimensions of the mayor's closet, or if Drake ever proposed painting the mayor's master suite pink—much as he did with one of his other clients, left—you'll have to look elsewhere. When asked if the pair ever had any disagreements about design issues, Drake did not bring up that time Mayor Bloomberg proposed installing a hot tub on the roof of his ever-expanding townhouse and Drake counseled against it. (We totally made that scenario up, by the way.) "When one has a fabulous relationship with a client for a long time, you obviously have a dialogue and a comfort and a trust that is a major and important component of each and every relationship." [NYO]

Unfortunate news for the dogs hoping to take a bite out of the $5 billion to $8 billion fortune real estate queen Leona Helmsley left behind when she passed away in 2007: A Manhattan judge ruled today that the trustees managing Helmsley's estate will get to decide how the funds are distributed, even though she left instructions that her money go to care for dogs. No word on how Trouble, Helmsley's beloved pooch, reacted to the news, but if someone files another mauling lawsuit, you'll know the news didn't go down well. [NYP]

This is probably going to come as a complete surprise, but some people are now suggesting that Madonna may have actually had a little work in the weeks leading up to the Academy Awards last Sunday. Shocking, isn't it? Next thing you know she's going to start running around town with a 22-year-old Brazilian model or something!

You don't need to travel all the way to India to experience the "party" portrayed in Slumdog Millionaire. You can "recreate the final scene of the Oscar winning, Bombay rags-to-riches tale" as part of a new workout class at the Crunch gym on 13th Street! "It's great," NYU professor Rebecca Packer tells the Daily News. "One can have fantasies and delusions of grandeur." Well put! "Grandeur" is totally the first word that comes to mind when we think of the movie, too. [NYDN]

People has a cheery interview with Michelle Obama planned for the next issue. What great insights can you look forward to? We summarized the weighty piece of political journalism so you can focus on the stories that really matter, like that Octo-mom lady or whatever:

It looks like it's been a good year thus far for Phil Falcone, the hedge fund kingpin who resides in the ornate Guccione mansion, is the owner of a pet pig named Pickles, and made a fortune last fall betting against the British bank HBOS. (He also controls a big chunk of the New York Times, which probably won't go down as his best investment of the year.) Hedge Fund Alert reports that Falcone is now buying out Harbert Management, the firm that provided him with $25 million in start-up capital in 2001, a figure that blossomed into many billions before later crashing back to earth. Falcone is buying back the stake for an undisclosed sum and the deal will give him "100 percent control of the firm," which is precisely what "greedy pig billionaires" very much like. Or so we've heard. [NYT/Dealbook, previously]

Cartier would really, really appreciate it if you didn't take their jewelry, copy it, and then post cheap imitations on your website with the words "inspired by Cartier" positioned next to each item. Yesterday, the company filed suit against Lisa Hsieh and her website LisaStyles.com for "willingly committing trademark and copyright infringement" by selling its various "Cartier-inspired" goods. Following time-honored Cartier tradition, the jewelry giant is not just asking a court to stop Hsieh from doing what she's doing: It's also seeking to have the infringing items turned over to Cartier so they can be crushed to bits. The lesson to be learned: Don't mess with the makers of luxury goods when they're struggling enough as it is due to the recession. The full suit is below.