Prologue. Someday far into the future, historians and social archaeologists out to discern the spirit of the time before the economic crackup might skip past the stock indexes and Wall Street tell-alls and excavate instead the junk mail embedded in computers moldering amid the ruins of life as we know it today. There they will find recorded the anxieties and aspirations, the hungers and delusions of the age:

Ready to Refinance?…adjustable rate mortgage…ashamed of your size…add a huge asset to your physique…which lender will you choose…make your girl HAPPY…make her wet and crazy…Rates are near 40 year lows…Rolex Replica Watches…Cialis $2.26, Viagra $1.31…get out of debt quickly…Turn Your Snake Into a Mighty Python…Your Home. Your Price.

Behind the scrim of boom there was always debt and sex, family and home and secret pursuits, an intimate economy of panic and desire. The engine that drove construction and consumption on credit simultaneously drove a supposed epidemic in sexual dysfunction–ED, FSD, HSDD–and exploding markets for manuals, therapies, Dr. Phil and drugs, mostly drugs. The backhoe and the little blue pill, the crane and Cialis; one way or another, happiness was just an expensive erection away.

While credit was easy, straight men, particularly those who prospered off the bubble, could pursue that happiness as they always have, freely circulating capital in the form of money, goods and emotions among wives, girlfriends and hookers. Not every man was so sexually leveraged; what mattered was that he might be, that every potential need had a market to satisfy it, and every market had the means to stoke and restoke desire in a mutually reinforcing system of monogamy, adultery and prostitution. That system, as old as the credit system and even more dependent on trust, confidence, magic and risk, was always messy, because love is complicated and sex might be, and because in a culture for so long ruled simultaneously by having it all and never having enough, how do you measure need?

Now, like Wall Street, the intimate economy is in turmoil. Just as the simple act of a family’s mortgage default, multiplied many times over, has rocked the rococo system of credit and finance, so the financial crisis affects the rococo system of monogamy and its adjuncts, as well as the myriad services that support and are supported by them, from the beauty industry to childcare to telecommunications, from low end to high. Where sex is concerned volatility reigns, and not just because its business but because it’s life.

Act I. Scene I. Before. Ed Hayes, New York attorney and man about town, has long gauged the stock market’s temperature by a High-End Girlfriend Index and High-End Stripper Index. “When times are really good, guys spend fortunes at strip clubs: $2,000, $5,000… You got a 20-something-year-old, he just got a $3 million bonus, he might spend $20,000 in one night. This guy in a club once says to me, ‘Listen Eddie, whatever I spend it’s cheaper than the divorce.'” Likewise, a courtesan’s time, even if it cost $10,000 a month, was a bargain next to the package for courting the young, fashionable girlfriend: the lease on a car, the $2 million Lower East Side condo, the dinners and baubles and $1,265/night weekend getaways at the Mandarin Oriental. Hayes has represented women after relations with the married boyfriend went sour: “I tell him, it’ll cost you a couple million to straighten out; it’ll cost you $50 million for the divorce; you figure it out.”

Such was the situation before panic set in at the top. In the intimate economy, sex has always been the least of it, particularly at the levels of mad wealth, where transaction costs take a different form. Average townhouse: $17 million. Baby: $50,000. One-day Yelling Center evaluation of the child’s bad behavior: $4,250. One week of Leg School at the Capri Palace Hotel and Spa for the frazzled mom: $4,923. An hour’s tutoring: $500. Country retreat: $2 million, $20 million… If anyone reflected that there might be a price for creating volatility to generate commission fees and bonuses, for causing despair through gentrification or foreclosure, it didn’t amount to much. In the web of exchange relations, perhaps the only person who fully grasped the extreme privilege and vulnerability of her situation was that relative rarity, the high-end call girl who had hustled her way up from the cheap brothels and champagne bars, and whose survival has always depended on a careful calibration of spreading her risk.

Scene II. The phone stopped ringing. Sandra was the new girl with the agency in July, when she was getting twenty calls a night for phone sex, while established workers got fifty. Most callers wanted her “co-ed” character–blond, petite, barely legal. Some wanted her mature lady. About five times a month someone called for her “ebony” character. Sandra is 35, creole–black to white men, unless she tints her hair red and wears green contacts to bring out her Latin features, as she sometimes does to get a gig dancing in a club. Since the crash, her twenty callers have dwindled to six; the other girls’ to twenty. Instead of thirty-minute calls, they’re mostly ten minutes now, at $2.99 per minute, but she doesn’t get paid unless she holds the call for five minutes, and “a lot of these guys are already in the midst of happiness when they call.” The day the bailout passed she got fifteen calls.

Phone sex agencies accept credit cards. Sandra, who is a member of PONY (Prostitutes of New York) but lives in Philadelphia, knows massage girls who have stopped taking cards. “I always believe in having cash on hand, and I always believe in having a civilian job.” Sandra also works as a midrange escort and picks up jobs housekeeping and catering. She recently dropped a longtime client because he demanded a deep discount. He’ll find it somewhere. On Craigslist, escort rates have been moving like the Dow ticker. Women who had $400-an-hour rates are running specials. Low-end ads are chockablock, but hourly prices are dropping: $180, $160, $100; indoor workers are offering out-calls, offering car dates. Amateurs are entering the market. You can smell danger. Sex workers in New York have been under heavy weather from raids and surveillance all year. $pread magazine estimates that “commercialized vice” and prostitution-related arrests nationwide have swung between 90,000 and 110,000; one editor, Monica Shore, worries that those will rise as cash-starved localities see opportunity in extracting fines.

Scene III. Deleveraging. As Lehman employees carried out their things in champagne crates, a friend and former sex worker remarked, “The worse shit gets, the more people escape to sex: paid-for sex, free sex.” The question is how the scale might tip. Ed Hayes speculated that this might be a good time for some high rollers, those who have watched their net worth collapse, to get that divorce. On the Internet a debate swirled around the “depreciating assets” of high-end girlfriends. Wall Streeters confide to their shrinks that they’re sneaking out to cheap massage parlors three or four times in the afternoon, calling escorts, visiting dungeons or strippers almost nightly. “Most people don’t lie about going to strip clubs anymore, so they’ll cut back on the budget for that, like any entertainment,” my friend said. “But the hooker budget is secret. I’m not so sure they give that up.” Sudhir Venkatesh, a dogged interviewer of prostitutes, wrote in Slate that they will do fine in the downturn. Indoor hookers are like psychiatrists now.

“I don’t think we’re like therapists; we’re like beauticians, except business is illegal,” said Tracy Quan, retired, whose rakish novel Diary of a Jetsetting Call Girl is also a deft account of occupational rigors and anxieties in an elite slice of the business just before the crash. In hard times a client might go longer between visits, might want less than the full treatment, might talk more about problems (or not), might expect that loyalty counts for something, and as every hairdresser knows, it does. But a pro is a pro. “If you’re really going to make your living, you cannot get by on conversation. Bottom line, you have to make sure the guy comes. Especially if you want repeat business, if you don’t want to be out there meeting Jack the Ripper.” Like the hairdresser, who is hurt when sex workers have less money to spend, the hooker will have to be flexible, to do more with less, and do it gracefully, with a confidence that neither the markets nor the arm-candy girlfriend and maybe not even the wife has.

As the tongue-in-cheek analyst team of longorshortcapital.com, parodists of investment science, replied to a question about the relative position of high-end players in the intimate economy:

“In good times, men are flush with cash and looking for strange but are also less dysfunctional; this leads to an allocation towards a basket mainly consisting of High-end Wives, with maybe a 15% position in High-end GFs and a 2-5% position in High-end Hookers. As markets worsen and/or crises take hold, Man is increasing dysfunctional and looking for ego offsets. It is also in this time when Man typically contemplates or engages in life restructuring which can entail simple cost saves, like headcount reduction, or even full-on recapitalization, flushing out the junior capital. A successful market-timing Man will typically have a portfolio composed of 60% High-end hookers, 30% High-end GFs and 10% value High-end Wives when the market is bottoming. As the cycle comes around, the High-end Hooker position is reduced opportunistically, some of the High-end GF portion transitions organically to High-end Wives and the value High-end Wife position is added to with more growth High-end Wives. As to relative vulnerability, obviously Man will be ok and everyone else will (still) be fucked in a recession. This is what historically has been true according to the data we have. Additioinally, the cross-cyclical trend we see is that everyone else will still be fucked.”

Tongue in cheek, but there’s a truth in every joke, and the first act of this crackup has just begun.