When he leaves the Duchesse to return home, the narrator often encounters Charlus and Morel on their way to Jupien's, where they took tea every day. Charlus was once offended when Jupien's niece said "I'll treat you to tea," a phrasing that was apparently considered "a vulgar one, particularly in the mouth of someone he was planning to make his almost-daughter-in-law." For Charlus is seeing to it that Morel and Jupien's niece are to be married. Meanwhile, Charlus has been flirting with a pageboy at a gambling club, who has written to him, and he is so delighted with the intimacy that he shows off the letter to M. de Vaugoubert, whom he usually avoids.
For the diplomat, with his monocle stuck in his eye, stared in all directions at the lads passing by. What was more, when he was with M. de Charlus, he grew more daring, and began to use a language which the Baron hated. He put all men's names in the feminine and, as he was very stupid, thought this was the height of wit and was constantly bursting out laughing.
The narrator comments to the reader that it shouldn't be surprising that this kind of "degeneracy" is often found in the upper classes: "As time passes, old families develop peculiarities -- a red, hooked nose, a deformed chin --" and "among these persisting and ever intensifying traits, there are some which are not visible: tendencies and tastes." Proust's references to homosexuality as "degeneracy" and "inversion" are sometimes read as his attempt to cover up his own gayness, but others think that with them he is widening the scope of his satire to include his narrator.
As for Charlus's enthusiasm for marrying Morel to Jupien's niece (despite her vulgar turn of speech, which, after he denounces it to Morel, she never utters again), it is a move to continue his control over his protégé. The reasoning is that "once he was married his fears for his household, for his flat, for his future would give M. de Charlus's wishes a stronger purchase upon him."
Morel has given up his previously expressed desire to seduce and abandon a young virgin, and the prospect of marrying Jupien's niece instead of raping her appeals to him especially after he experiences cramps in his hand that raise the possibility that he will have to give up the violin. "Since, in everything outside his art, he was unbelievably lazy, he would need to find someone to keep him, and he felt he would rather it were Jupien's niece than M. de Charlus." Morel has also borrowed money from Bloch, befriending him during the transaction and then denouncing him after he realizes that he's going to have to repay it: "anti-Semitism was, in Morel, the natural result of having been lent five thousand francs by a Jew."