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On November 19, 2003, Berman attempted suicide in Nashville by consuming crack cocaine, alcohol and tranquilizers. He wrote a short note to Cassie—the brevity of which Berman would later regret—put on his wedding suit, and went to a "crack house" he frequented. When discovered by Cassie, he verbally lashed out and refused treatment. He was eventually taken to Vanderbilt University Medical Center, awakening three days later.
Around a year later, Berman checked in for drug rehabilitation, which was paid for by his father, and encouraged by his mother and Cassie. Berman said he had relapsed but that by August 2005 he was not using drugs. During his rehabilitation, Berman embraced Judaism, choosing to study the Torah and sought to be a "better person" who was "easier" to Cassie and staff at Drag City; he would soon consider Judaism as an integral aspect of his life, which he intended to continuously labor over. Reading the Torah helped him learn more about poetry; David, described in the Hebrew Bible as a king of the United Monarchy of Israel and Judah, was also an influence of Berman's. He described Judaism as having an affirmative effect on his life.
Reflecting upon his suicide attempt, five years later, Berman noted that he was not unprivileged and without career opportunities, although this was not evident to him at the time. He began to excessively take antidepressants, and his sobriety made him more receptive to candidness. In 2005, and by means of "saving [himself]", Silver Jews, with a lineup including Cassie, Malkmus, Nastanovich, Bobby Bare Jr., Paz Lenchantin, and William Tyler, released Tanglewood Numbers. Soon after, the band began to tour, with 100 shows from 2006 to 2009 taking place; to cope with the hectic nature, he became "a daily pot smoker". Before Berman toured, he occasionally made caricatures of fans, considering them more rewarding.
By this time, Silver Jews had sold 250,000 records. Berman and Cassie still experienced financial difficulties; Cassie worked an office job and Berman struggled to get medical insurance for the removal of a keratoconus, eventually acquiring it from the Country Music Association. In 2005, Jeremy Blake enlisted Berman for Sodium Fox, a conceptual artwork centered around Berman. Blake's suicide and Berman's eye operation would affect the next Silver Jews album—before the operation Berman reported feeling "less aggressive and less tenacious". Lookout Mountain, Lookout Sea was released in 2008 to lukewarm reviews. The album was their most commercially successful.
Berman's decision to tour, no longer dependent on drugs, was based upon his greater age, his expanded discography, and a desire to interact with his audience, which resultingly "softened his naturally gruff exterior". Berman found touring with Cassie eased the experience, of which he had mixed feelings. He considered her a necessary component, and noted that if he was alone he would likely act to his detriment.
On January 22, 2009, Berman disbanded Silver Jews, and their final show was played the following week at Cumberland Caverns in McMinnville, Tennessee. "I always said we would stop before we got bad", and during the performance at Cumberland Caverns, claimed that "I always wanted to go out on top, but I much prefer this". According to Nashville Scene's Sean L. Maloney, due to Silver Jews' impact on Nashville's mid-2000s music scene, the final show meant "a chapter in this city's artistic evolution closed".
Alongside the news of the band's dissolution, Berman publicly announced, for the first time, that his father was the lobbyist Richard Berman, who he viewed as markedly loathsome and from whom he had been estranged since 2006. Berman reported owing Richard money, and once donated to a supposed investigation of Richard, initiated by the watchdog group Citizens for Responsibility and Ethics in Washington, who called upon the Internal Revenue Service's intervention. Upon considering the commercialization of modern musicians, he began to see his and Richard's lives intertwining; Berman's guilt about his father and said consideration were the reasons he retired Silver Jews, saying:
After Silver Jews disbanded, Berman became a recluse. The "hermit, solitary aspect to the way [Berman] live[d]" predated this time, according to a 2008 interview—and Nastanovich reflected two years earlier that Berman had "gotten more reclusive". In 2005, posed with the question of whether he had chosen between vulgarity or loneliness, Berman said "it's been loneliness up till now but it looks like things are changing for the better/worse". His public perception became intertwined with fiction—significant speculation upon the events of his suicide attempt had reportedly occurred before this time. His seclusion, according to Stephen Hyden of Uproxx, concoted a perceived "mythology".
Berman published a 2009 book of surreal, minimalist cartoons called The Portable February to mixed reviews. He would later work with German artist Friedrich Kunath on the book You Owe Me a Feeling (2012), which features paintings and poetry by Kunath and Berman, respectively. Cassie sought a career in pediatric therapy. In 2010, he spoke about his difficulties with writing a book about his father—seeking to become his "nemesis"; HBO nearly adapted the book, but Berman canceled production, saying he did not want to glamorize his father. In an article about Berman, Derek Robertson said that a significant amount of his personal life was an "explicit rebuke" to Richard and an attempt to evade institutional power—Thomas Beller interpreted Berman's disdain as both political and personal.
By 2016, Berman had experienced the deaths of both his friend Dave Cloud and his mother, which compelled him to adopt the middle name Cloud and write the song "I Loved Being My Mother's Son", respectively. He was still in contact with Malkmus and maintained a close relationship with Silver Jews drummer Brian Kotzur. According to Nastanovich, at one point Berman intended to write new Silver Jews songs; he ultimately became more interested in a new style. As noted by Jewish Currents' Nathan Goldman, Berman soon "inaugurated...a different artistic phase with a series of songs about the disappointments of expectations unfulfilled", contrasting the "odes to the open field of possibility" that closely proceeded the Silver Jews' conclusion.
In 2018, Berman and Cassie separated. Lacking money and living off royalties from Drag City, from June he lived in a room above the label's Chicago office. According to Berman, they "never had the kind of conflict that results in divorce" but had a "kind of need to live [their] lives without the other one". Berman thought his chronic depression meant he was "unfit to be anyone's husband". He and Cassie maintained a shared bank account and owned a house together, while he considered her an integral part of his family. He briefly lived in Miller Beach and Gary, Indiana. At one point, he asked a friend to give him heroin but was refused, for which he was ultimately grateful, having not used heroin or cocaine since October 2003.
He had grown disillusioned with Judaism, saying his belief in God lasted from 2004 to 2010; in 2008 he voiced a disconnect from Judaism, positioning himself as adjacent to Jews. In his withdrawal, he "[fixed] himself in Jewish tradition", said Goldman and Arielle Angel of Jewish Currents, viewing Berman as archetypal of Jews. His once-passion for Judaism made him eager to tour Israel; there he met Yonatan Gat and helped get him signed to Drag City—"[The] shows we played in Israel were pretty much the most amazing experience of my life". In 2018, Berman co-produced Gat's album Universalists. By that year, Berman had conceptualized a more conspicuous return to music: a new moniker, entitled Purple Mountains.
Following the release of two singles under his new moniker, an eponymous debut album was released in July 2019. An "instantly mythologized" album, Berman received heightened attention and very positive reviews: "Purple Mountains looked like the start to an unexpected second act for David Berman". Berman worked on Purple Mountains with Woods and Berman's friend Dan Auerbach, with whom he had worked in 2015; Auerbach called Berman "one of [his] heroes".
Berman's financial difficulties, the breakdown of his marriage, and encouragement from Drag City's president Dan Koretzky were impetuses for Berman's new music. Berman hoped to resolve the $100,000 of loan and credit card debt he had amassed as a result of his drug use; in a 2005 interview, he said: "I've got a credit card rotisserie system that would dazzle the ancients". He stated this was the only reason he intended to tour. Berman discussed the idea of a collaborative tour with Bill Callahan and Oldham, which ultimately did not occur. He expressed worries about the tour and notified the accompanying band that his depression may interfere but was excited for his "solitude to end".
In June 2019, Berman said: "There were probably 100 nights over the last 10 years where I was sure I wouldn't make it to the morning". Berman died on August 7, 2019, having hanged himself in an apartment in Park Slope, Brooklyn, New York. It is unclear whether Berman's suicide was spontaneous or deliberated upon; according to The Philadelphia Inquirer's Dan DeLuca: "The warning signs were all over Purple Mountains". Will Reisman of SF Weekly reflected that by the time of Purple Mountains' release, Berman appeared as a "grim visage...Tinted sunglasses covered a set of weary, stricken eyes, his neck-length hair was thinning and reedy, and a pursed, lifeless expression graced [his] face". A private funeral attended by "Friends and family, along with the Jewish community" took place on August 16—a memorial, by filmmaker Lance Bangs, at New York's Met Breuer Museum, the former location of the Whitney, was held earlier.