This isn’t a video effect and the blinking lights are not in any way an FAA-approved strobe, nor would lanterns blink. Balloons equipped with flashing lights might, though, so that’s always a possibility. The head of the Baby James Foundation said they they were Chinese Lanterns released by the foundation as a publicity stunt, but did not explain how it was that the candles were able to blink on and off.

Story Source:
http://www.ufocasebook.com/2011/chicagoufovideo.html