Why Stable Diffusion works in a compressed space. A hand-painted kiosk sign in Mombasa is squeezed by a VAE into a small grid of numbers, diffusion runs there, and the decoder expands it back. Slide the squeeze factor and watch the cost of every step fall while the lettering holds, until it does not. Then diffuse in pixel space, squeeze too hard, or forget the latent scaling factor. This lesson needs JavaScript.