Squidward realizes he drove everyone that he could consider as friends away. His depression has gotten worse in the absence of SpongeBob, he never knew that despite his distain for SpongeBob, he needed him to keep going. Now that he's severed all ties and burned all bridges, he has no one. All he can do now is cling on to the memories to keep himself alive. All the music he listens to in bed just remind him of the friends he never knew he had.