After impulsively declaring his retirement from acting in the fall of 2008 after wrapping the film 'Two Lovers,' Joaquin Phoenix gained a natty beard and a paunch, chased a new career as a hip hop artist and looked depressed and druggy on a February 2009 appearance on the 'Late Show With David Letterman' that was widely viewed on the Internet. Now that the world at large sees the 35-year-old actor as a basket case, Phoenix will need to do some serious repair work to reemerge from this two-year career hiatus. (The fact that his gifted, troubled older brother River died of a drug overdose does not help his case.)

Latest Misfire: Phoenix's life in retirement is the focus of the bizarre Casey Affleck mockumentary, 'I'm Still Here,' which tracked the ex-actor's pursuit of record producer P. Diddy, his increasingly debauched lifestyle and his musings about celebrity and acting. "I'm stuck in a ridiculous self-imposed prison of characterization," Phoenix explains in the film, seeking to escape being branded as "emotional, intense and complicated." He no longer wants to play "the character of Joaquin Phoenix." This documentary was his way of "doing something that represents me ... to bring what is inside me out."

The film debuted at the Venice Film Festival and moved on to Toronto, as Affleck deflected and misdirected the media, and the clean-shaven and slim Phoenix stayed behind the scenes to maintain the mystery. The movie was about "friendship, ambition and the dreams of an artist," Affleck said. Reviews were nasty and audiences stayed away in droves.

Current Gossip:
The confused media didn't know what to think. This "document" shows an actor going down the tubes -- snorting cocaine on camera, trawling for prostitutes, jumping into the audience to bash a fan wearing a Ben Stiller fake beard and getting punched in the gut (making him throw up). Was it real or fake? What the hell was Phoenix doing, committing career suicide? Creating an indelibly accurate portrait of a miserable depressed self-medicating and deluded actor? Doing an Andy Kaufman-type performance piece, egged on by brother-in-law Affleck?

It turned out to be the latter, as Affleck explained to the New York Times just before the movie widened into more theaters this past weekend. "It's a terrific performance, the performance of his career," Affleck said, adding that he used well-rehearsed actors.

Letterman wasn't in on the joke, he added. However, Letterman writer Bill Scheft insists that they all knew what was going on.

Career Peaks: Starting off as a child actor, "Leaf" Phoenix did TV roles until he broke out in 1989's 'Parenthood' and 'To Die For.' In 2002, he co-starred with Mel Gibson in M. Night Shyamalan's 'Signs,' which grossed $408 million worldwide, but he has always been a solid character player more than a marquee draw.

Awards Attention: Phoenix earned his first Oscar nomination as the emperor villain in 'Gladiator' (2000), and another Oscar nomination for channeling Johnny Cash in 'Walk the Line,' which demonstrated far more musical ability than 'I'm Still Here.'

Biggest Problem: The perception that 'I'm Still Here' isn't so far from reality. No matter what Phoenix says to clear himself of his drug-addled bad boy image, he will have to restore his luster when he returns to Letterman on Wednesday. Phoenix's career trajectory was already on a downward slide after 'Walk the Line.' He starred in two films that flopped, the grim 2007 drama 'Reservation Road,' in which he played a father driven nuts by his child's accidental death, and James Gray's depressing micro-budget 'Two Lovers,' opposite Gwyneth Paltrow. Phoenix didn't need two years off to play this role as a crazy depressed deluded actor. Truth is, he's never been a marquee draw in such films as 'Quills,' 'Hotel Rwanda,' 'Return to Paradise,' 'We Own the Night,' 'The Yards,' 'Inventing the Abbots,' 'Buffalo Soldiers,' 'Ladder 49' and '8 MM.'

Biggest Assets: Hollywood is scrambling to cast strong leading men in their movies. If Phoenix can convince the community that he's still one of the great actors as well as being lean, clean and sober, he'll get plenty of offers. It won't take long for WME agent Patrick Whitesell, who was in on the joke and played himself in the movie, to find him a job.

Next Step: Phoenix has been flirting with a number of projects that have not coalesced. He was in talks to join the mayhem in the David Gordon Green comedy 'The Sitter' as a drug dealer in pursuit of hapless babysitter Jonah Hill. He considered co-starring as novelist Thomas Wolfe opposite Sean Penn as editor Max Perkins in 'Genius,' but the Bill Pohlad-directed project isn't yet happening.

He was circling the role of Edgar Allen Poe that John Cusack landed in James McTeigue's 'The Raven.' Phoenix really is attached to play a footwear designer and fetishist opposite Mia Wasikowska in 'Big Shoe,' from director Steven Shainberg (who directed the S & M comedy 'Secretary' and the strange and under-appreciated flop 'Fur: An Imaginary Portrait of Diane Arbus'), which is probably not Whitesell's idea of what Phoenix should do next to reestablish his movie star cred. The film has not yet raised financing.

And the latest: producer Rob Lorenz denies that Clint Eastwood is pursuing Phoenix to play J. Edgar Hoover's lover Clyde Tolson.

Career Advice: Phoenix needs to find a solid role with an established director in a mainstream studio movie -- he's in the running for a role opposite Jennifer Garner in Disney's 'The Odd Life of Timothy Green' -- to remind the world of what he can do. He may not realize how far out on a limb he ventured as he claws his way back to being a bankable movie star.

Anne ThompsonAnne Thompson -- who has served as Deputy Editor of and The Hollywood Reporter, West Coast Editor of Premiere and Senior Writer at Entertainment Weekly -- writes a daily blog on indieWIRE, Thompson on Hollywood. You can check out some of her latest posts here:

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