A litmus test in psychology refers to how when you feel down you usually act accordingly. Someone who is experiencing euphoria will act on a much higher level than someone who is experiencing depression.
This leads to the second part of the line: everyone knows that working out when you are down is one of the best solutions to get you going again. Now his, “Life is good, I live everyday like Christmas”
A litmus test is also a test for acidity in chemistry. So this line fits with the next one about citrus because citrus is acidic. The “litmus test” has been notoriously used as a term to gauge whether or not something is legit. This happened, as the litmus paper (used to determine basic or acidity) was used so often it became a symbol of quality, because it never failed…much like RZA.
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What Cudi is saying is that people hide themselves often and since that seems to be the case, he will change to adjust. Meaning those who once knew him will no longer know him.