ALO ALTO, Calif. — Within walking distance of Stanford, where the economist who coined the term "conspicuous consumption" once taught, a dark reality is playing out. Having already gone from boom to bust, many dot-commers are coming to something worse. Unable to make payments, they are selling luxury cars, canceling home renovations and returning jewelry by the box.

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This region has grown accustomed to high-technology highs and lows over four decades, but the current dot-com collapse has lasted longer and cut deeper. And the recently affluent technology workers who had come to believe in the "long boom," the idea that prosperity would be permanent, are quietly giving up their flashy signs of success to make ends meet.

On a counter at Neiman Marcus here, an anchor of one of the nation's most exclusive shopping centers, sits a necklace of amethyst and labradorite. The opaque lavender piece goes for $470, which seems like a fair price for handcrafted jewelry. It is, however, preowned: bought two and a half years ago, at the peak of the Internet bubble, it was returned to the retailer six months ago.

"When people have too much new money, the way to demonstrate their success is with a lot of frivolous expenditures," said Randy Komisar, a longtime high-technology executive and the author of "The Monk and the Riddle: The Education of a Silicon Valley Entrepreneur."

Now he says the downturn has produced a painful return to reality: "There is a sense that people got ahead of themselves. People were trying to be more than they actually were, and they expected that the future would look like the past."

It was the economist Thorstein Veblen who first captured the foibles of the recently rich in devastating fashion more than a century ago in "Theory of the Leisure Class." He argued that there was an innate urge to consume as an end in itself and that an entire social class defined itself by what it could buy.

Now, in Silicon Valley, a part of the dot-com class is being defined by what it needs to return. "This is the reality of downward mobility," said a jewelry saleswoman who works at Neiman Marcus. "There is an underlying need to appear that this isn't happening in their lives."

Jewelry, perhaps the most frivolous of purchases, is returned first, she said, in an effort to keep up appearances of normalcy.

Occasionally the personal financial crises descend into pathos. Not long ago, the saleswoman said, a woman came to her and tried to return the small ornament the store puts on gift-wrapped packages. "It's bizarre and funny," she said. "There are people who are not as wealthy as they once were, and then there are the people who are desperate."

Indeed, a growing number of those who rode up with the boom are now doing what they can to hang on quietly during Silicon Valley's downturn.

"My fantasies have gone from Gulfstreams to Airstreams," said Matthew Naythons, who was once worth millions on paper as the editorial director of PlanetRX and who is now starting over with a new company, Epicom.

This downsizing of lifestyles is consistent with the rising unemployment, soaring commercial real estate vacancy rates and softened market for hotels and restaurants.

The one area where the economy remains hot — although no longer so sizzling — is the market for homes, which are still in short supply. Moreover, brokers say, homes here are increasingly viewed as a haven from the much riskier investments in the staggering stock market.

For others, housing is a mainstay, not one of the luxuries they are purging from their lives. Indeed, unable to make payments, some former dot-commers, and others whose income swelled with the bubble and shrank when it burst, are selling Porsches and BMW's on consignment. They are unloading second homes and canceling renovations.

"People are going through old jewelry boxes and pawning old jewelry," said one high-end jewelry designer, who insisted on anonymity. She said the return rate at Nordstrom was as high as 50 percent, double the traditional rate.

Jewelry is coming back "worn, torn, filled with hair spray and broken," she said. "Some people are breaking it and then coming back saying, `This is broken.' "

While the economy is by no means moribund here, there are signs of suffering at both the low end — where people are unemployed — and the high end, where the reserves have run thin.

"These dot-com guys can't handle the payments anymore," said Eddie Manio, a sales associate at Bay Area Lease in Redwood City, which sells cars on consignment, taking roughly a 5 percent cut. A picture behind Mr. Manio's desk shows Abraham Lincoln, George Washington and Mr. Manio, with the legend: "Three people you can trust."

A growing number of people are trusting Mr. Manio to help them sell cars like Porsche, BMW and Mercedes. In the showroom is a 1997 Red Lotus whose owner, who works in commercial real estate, put 15,000 miles on it and is asking $57,500.

Next to the Lotus sits a Porsche Boxster and a '99 Mercedes SL500 for $59,500. The company recently took in a BMW 740i, a luxury sedan, from someone in the software industry.

Mr. Manio said the seller was typical of the kind of client he was seeing more of — "Silicon Valley and Internet people." But he said that while the numbers of people bringing in cars for sale was rising, he was having trouble finding any buyers.

Carmen Michaelian did not work for a dot-com, but she is feeling the pain, too. She works at the jewelry counter at Nordstrom, selling mostly costume pieces from $30 to several hundred dollars. She said that Nordstrom was liberal about letting people return things, even if they had not recently bought them and even if they were unable to prove that they had bought them at the store.

While this is perceived as good customer service, it is tough on the salespeople, who lose their commissions when there are returns. Ms. Michaelian, who during a very good two-week period will sell $15,000 of jewlery, is also regularly seeing the effect of returns of $3,000 to $4,000 on each two-week paycheck — a figure she said was typical.

Late last year, she processed a return for a woman who brought in eight necklaces and some bracelets she had bought two years ago. "She didn't say why," Ms. Michaelian said. "Maybe she lost her job."

According to Jan English-Lueck, a professor of anthroplogy at San Jose State University and author of "Cultures at Silicon Valley," the downturn appears to have eased for some people, but that is hardly universal. She said many people remained overextended — stuck with big mortgages, for example — and may be returning items not just to downsize their lifestyles, but to lift their bank accounts. "People are turning merchandise into money," she said.

More generally, the idea that people are returning big-ticket items is consistent with how they view acquiring those items in the first place. "People use disposable income as a cushion," she said, spending money on more extravagant items they know they can return if necessary.

"People buy things with the understanding that, `if it doesn't work out, we'll sell it,' " she said. "It's like a buffer of wealth." More specifically, she said, Silicon Valley consumers are "sophisticated consumers who know how to return merchandise."

Lately, Ms. English-Lueck has been researching the attitudes of teenagers and their families in Silicon Valley. She said that she was seeing a renewed emphasis on simplification. Young people are thinking more about the long-term future, even retirement, she said.

"There is a sense that money could go and jobs are not that stable," she said. "Those things are beginning to loom in people's consciousness."