In Sei'an City (or any other large area), draw a sun, but draw it as low in the sky as possible. Then, run towards it and double-jump (requires Holy Eagle skill). Quickly press B and rotate the camera, and you'll find that the sun is actually quite close to the ground. It helps if you use the 2 Button to zoom out before doing the glitch.
If you're close to someone, you can see them in full detail, plus their heads show up in their thought bubbles.
If you're far away from someone, you can't see them at all -- all you can see is their thought bubbles, which contain just a general frowny face.
But if you're the exact right distance or angle from someone, you can see some odd placeholders. The placeholders' colors are random; the colors I've seen are purple, deep blue, aqua, yellow, teal, and green.
The glitch can be done in any area where a person can be seen from a great distance. For example, if you go onto the bridge in Sei'an City's Aristocratic Qtr. (where this video was taken), you'll notice some odd orange globes on the rails; go to the fourth one from Rao's building and all of the people shown in this video will be clearly-visible placeholders.
Another place you can spot them: go to the Emperor's area of the city, and stand near the near the first two sentries, but off to the right, such that you're far away from the Emperor but can still see him; if you get the distance right, he'll be a yellow Placeholder.
Image viewing script used is ThickBox 3.1, developed by Cody Lindley.
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