The laughing man is somewhere near the Yangtze, and only appears if you have sanity lower than a certain threshold.
He's actually the Transcendant.
That was my first thought too.
The Transcendant makes more sense, and I think I did run into him in one playthrough. But his transmissions are so garbled it's hard to tell if he's laughing.
Eventually my mental health status changed from "rev0rt411" (or something like that) to "Hello".
"Hello" is worse.
Yeah, I think it goes: Intact -> Degrading -> Unstable -> rev0rt411 -> Hello -> Perfectly All Right -> :snipe: