Hoarding cash

Just came across this Zerohedge article: "Safes Sell Out In Japan, 1,000 Franc Note Demand Soars As NIRP Triggers Cash Hoarding".

Hoarding cash may sound a like a good idea currently, with low price inflation and negative interest rates.
However, it is a big mistake to put Swiss Francs as cash into a safe. You may forget about it and have a bad surprise when you want to use or convert your nice pieces of paper in the future.
Here is the explanation in four charts.

1) Base money and 1,000 CHF banknotes (y-scale limited to 80Bn - click to enlarge chart)

The amount of cash hoarded as 1,000 CHF notes (CHF 71 Billion) is now much larger than the entire monetary base as in summer 2008 (CHF 45 Billion). First "Uh-oh". In case you are thinking "So, what ?", ask yourself what might be the value of this additional cash. The answer is: nothing. Again: this cash is backed by nothing. The market and especially the people hoarding cash into safes are not (yet) aware of that, fortunately for them (for now).
Now, what is the entire chart of base money (in the chart above, the y-scale is limited to 80 Billion) ?

2) CHF Base money (log scale - click to enlarge chart)
Second "Uh-oh". Again, this new money is backed by nothing. It is sold against foreign currencies by the Swiss National Bank to Mr Market who is thinking "Wow, the Swiss Franc, it must be rock-solid! The mountains, the gold, the army - what can be wrong ?"
With the foreign currencies, the SNB is buying bonds and equities in EUR or USD with more or less success.
Oh, a detail. The y-scale of chart 2 is logarithmic: there is a doubling at the crossing of each horizontal line.
With a normal scale, it looks like this:
3) CHF Base money (lin scale - click to enlarge chart)
Now a last one, if you did not have enough charts:

4) CHF and ARS Base money (pre mid-2014: one data point per year for ARS - click to enlarge chart)
Happy hoarding!


Visual Deflating

Compressed as bitmap with the Deflate format with dynamically computed Huffman trees, you may get this when dumping the bit length for each code (columns) with successive chunks of the image (rows):

Literals / LZ Lengths / LZ Distances
Current research with the Zip-Ada project.



...not in the economical sense fortunately, except that it's all about economy of bits.

Following last post about limited-length Huffman trees, there is now the very early development of a compression algorithm for the so-called "Dynamic Deflate" compression format. From revision #297 the code (checkout here) seems to correctly compress data (correctly means that the data is correctly decoded, even by buggy but popular decoders...).
The efficiciency of the compression is in the works. Stay tuned!

Testing is welcome: build and use the ZipAda command-line tool, or use the Deflate_1 method in your code using the Zip-Ada library.


Playing with limited-length Huffman trees

A small portion of a Huffman tree
Proper counting is crucial

On the second image you can recognize "DIZAINES" and "UNITÉS". The letters are hardly visible after some 90 years of use... It's a pool table in the mythic Schlauch Restaurant in Zurich.

Back to Huffman trees: just came across a beautiful algorithm [1] for building a Huffman tree with, as a constraint, a limited code length. With the original Huffman algorithm, parts of the tree may become arbitrarily long - well, obviously not longer that the alphabet to be encoded. This algorithm is optimal (given the constraint), fast and very economical in terms of used memory.

There is an equally beautiful implementation [2], translated for the purpose of the Zip-Ada project - a proper dynamic Deflate for compression is still missing, and a limited-length Huffman tree building algorithm is needed for that.
Translation is there: specification, body, test procedure, and abstract enough to build with an Ada 83 compiler (at least GNAT in -gnat83 mode)!
[1] Search: "A Fast and Space-Economical Algorithm for Length-Limited Coding"
[2] Search: "katajainen.c" (this part of the "Zopfli" project)

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(Click to enlarge chart)

We learn today that Deutsche Bank's balance sheet is "rock-solid".
So, don't worry, folks!

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