  We propose a new optimized phonon approach for the numerical diagonalization
of interacting electron-phonon systems combining density-matrix and Lanczos
algorithms. We demonstrate the reliablity of this approach by calculating the
phase diagram for bi-polaron formation in the one-dimensional Holstein-Hubbard
model, and the Luttinger parameters for the metallic phase of the half-filled
one-dimensional Holstein model of spinless fermions.
