@shadowking, I tried the settings you suggested for WavPack, up to -b4.55x5s.5, and I still hear that hiss. Aggrrrhh! Since this sample sounds more like regular music than a proof of concept, I have a panic at the thought that other music could be compressed in such a low-quality way. So I suspend the use of the hybrid WavPack and hope that @bryant will be able to fix it.

@shadowking, have you tried lame3995o (thread,  download) by @halb27?
Put mp3packer in the same folder, use a new switch -Q1 alone and witness the miracles.

@shadowking, I tried the settings you suggested for WavPack, up to -b4.55x5s.5, and I still hear that hiss. Aggrrrhh! Since this sample sounds more like regular music than a proof of concept, I have a panic at the thought that other music could be compressed in such a low-quality way. So I suspend the use of the hybrid WavPack and hope that @bryant will be able to fix it.

@shadowking, I tried the settings you suggested for WavPack, up to -b4.55x5s.5, and I still hear that hiss. Aggrrrhh! Since this sample sounds more like regular music than a proof of concept, I have a panic at the thought that other music could be compressed in such a low-quality way. So I suspend the use of the hybrid WavPack and hope that @bryant will be able to fix it.

@shadowking, I do not use -x6, because it significantly increases the encoding time, and -h, because it requires more resources for decoding. Therefore, my attempts to improve the quality look like this: -b3x4, -b4x4, -b5x4, -b6x4, -b7x4. With -b6x4, there is a shadow of hiss, but still a noticeable shadow, which can be suppressed by adding -s.3 or -s.5. But what is -s really, why it's not there by default, what are the downsides? So only with -b7x4 I can breathe a sigh of relief.

But at this point WavPack loses its advantages in the lossy 44 kHz 16 bit segment (except for correction files feature) over FSLAC -3 (and even Vorbis -q 8, I believe). Alas, @C.R.Helmrich, its author, is still too lazy to bring this project to a brilliant finale with the implementation of 24-bit support and taking into account other shortcomings.

The lossy mode employs no subband coding or psychoacoustic noise masking. Instead, it is based on variable quantization in the time domain combined with mild noise shaping. This mode can operate from bitrates as low as 2.22 bits per sample up to fully lossless and offers considerably more flexibility and performance than the similar, but much simpler, ADPCM. This makes the lossy mode ideal for high-quality audio encoding where the data storage or bandwidth requirements of the lossless mode might be prohibitive.

What would be better is 2nd-order noise shaping or even better would be a noise-shaper peaking at 15 kHz (neither of which WavPack supports). Another thing that would work would be simply detecting that the noise level was above the signal at audible frequencies and boosting the bitrate at that point (I think lossyWAV does something like that with this sample). These are all possible improvements to WavPack lossy that I wish I had time for.

If you think there is a fundemental flaw not only in artificial it would be good to prove it via listening tests and some real music samples.

$ wavpack --version
wavpack 5.7.0
libwavpack 5.7.0

$ wavpack -hx4m --threads=4 original.wav -o lullaby.lossless.wv 
$ wavpack -b4x4 original.wav -o lullaby.lossy.wv

Interesting sample. There is massive HF energy from 16khz to 22.  Human vocals don't do this. I do hear a hum in background, Is it a synth no sure..
Why would a properly mastered recording have this ?

Do you have an artist / cd title ?

So, What is this stuff ? This is certainly not professional cd audio.

The level is so low that the dither is heard,  How can that be  ?
Or, Is the vocal NOT meant to be heard (hidden) without  - amplified to a  level x100 ?

@shadowking think of it as a watermarked demo or a bootleg copy or a stream recording with effects added, so as not to lose sleep. The point is that the range from 16 to 20 kHz is not a wasteland and there might be a palpable energy in it that WavPack hybrid must be able to handle in a more intelligent way. After all, it's not for properly mastered CD audio only, right? For example, the energy in this sample reminds me of the noise (hiss to be precise) of an analogue medium like cassette tape.