  Modulational, Benjamin-Feir, instability is studied for the down-stream
evolution of surface gravity waves. An explicit solution, the soliton on finite
background, of the NLS equation in physical space is used to study various
phenomena in detail. It is shown that for sufficiently long modulation lengths,
at a unique position where the largest waves appear, phase singularities are
present in the time signal. These singularities are related to wave
dislocations and lead to a discrimination between successive `extreme' waves
and much smaller intermittent waves. Energy flow in opposite directions through
successive dislocations at which waves merge and split, causes the large
amplitude difference. The envelope of the time signal at that point is shown to
have a simple phase plane representation, and will be described by a symmetry
breaking unfolding of the steady state solutions of NLS. The results are used
together with the maximal temporal amplitude MTA, to design a strategy for the
generation of extreme (freak, rogue) waves in hydrodynamic laboratories.
