When I was in graduate school, a fellow student loaned me a copy of Almost Blue. I had avoided it because it was just an album of covers — and country covers at that. But I was blown away with how much I liked it. Some time later, I bought a re-issue of the album, that contained a whole bunch more songs. And there at number 18 was Costello’s version of Leon Payne’s song “Psycho.”
It is a perfect song. It tells a very compelling and complete story while maintaining the emotional core that all songs should have. It also has perhaps the best payoff line of any song I can think of. It reinforces the theme of the song while re-framing the plot. The interesting thing is that I have found no one covering the tune before Costello. He seems to have been alone in realizing what a great tune it is.
There is a live version (but I can’t embed it). So here is the album cut: