October 9, 2007: Blue Angel makes pass over Frisco Bay boaters

[Bullitt]

Not BS, I've seen this in person when I was a kid living in southern California at the Miramar air shows (though that was over ground not water). These guys are so damn good it is mind blowing. And yes that cloud is water vapor, you can see the same sort of thing when a jet is at high speed and suddenly changes to a high angle of attack.
You can see the water vapor starting to shake off here:

Which then turns to this:


Also called "pulling vapor".

Those telephoto pictures are also very deceiving as to how close the jet was to the boats and spectators. Judging distance between two objects laterally in a telephoto image is next to impossible, so often it appears as if two objects are much closer than they actually were when the image was captured. I very much doubt anyone was close enough in reality to get hurt by the jet's repercussions. The Blue Angels are extremely professional and would never pull a stunt that would endanger the public so recklessly.