Where are the customers' yachts?

Have you had a book with you that you meant to read for quite sometime and never managed to get around to it, but it still came back to haunt you every once in a while?  "Where Are the Customers' Yachts? or A Good Hard Look at Wall Street" by Fred Schwed Jr. was one of them.  If you asked Fred who?, you especially should continue reading.
I came across this book some years ago, around the same time I read about Ben Graham and Warren Buffett and didn't think much about it.  Later this book popped up in a Buffett recommendation.  On autopilot, it went to my Amazon wishlist and ended up being bought with a few others when the opportunity arose.  And it sat on my bookshelf for sometime.
Recently, I was going to travel and wasn't really looking forward to it due to the connections and the quality of the immigration/customs service and the airport.  I wanted a read that would keep me sane during those 12 odd hours.  "Where Are the Customers' Yachts?" was staring right at me.  Oh!! what an interesting plane ride it was?  (If you saw a passenger in a Jet Airways flight chuckling to himself reading a book, you now have the mystery unraveled.)  The book provokes thought at the same time it makes you smile.  After reading this, I walked away with a much better understanding of the French expression, Plus ça change, plus c'est la même chose  (the more things change, the more they remain the same).  (Next time you meet me, don't ask me to pronounce the expression unless you have come with low expectations; I mean lower than the real low.)
The title of the book comes from an almost apocryphal sounding story of William R. Travers who after admiring the rows of beautiful boats owned by the rich brokers by the shores of Newport, Rhode Island is reported to have asked wryly "Where are the customers' yachts?"
Now to the Fred who?.  Fred Schwed Jr. was a professional trader who after having lost a bundle in the 1929 crash quit the Street for good.  He is also the author of "Wacky, the Small Boy" a children's book.  (After meeting some of the characters in the Street, I should probably say that Fred wrote about his audience in 1940 after writing the children's book in 1939).
After reading the chapter on Short Selling, you would think that the book was written just recently and not 70 years ago.

If you thought Ben Graham has the best distinction between speculation and investment - read this "Speculation is an effort, probably unsuccessful, to turn a little money into a lot.
Investing is an effort, which should be successful, to prevent a lot of money from becoming a little."

If you are the kind that invests in mutual funds or takes the help of an investment adviser, read this:-
"Some of these other gentry allocate the funds between themselves and their clients in the ancient classic manner, i.e. at the close of the day's business they take all the money and throw it up in the air.  Everything that sticks to the ceiling belongs to the clients."
(Reminds me of how Lucy decides which bills to pay.)

Here's another mystery solved regarding pay in Wall Street:-
"...how much do they pay these fellows?  Since this subject is nobody's business, everybody is interested.  As the man said after he had had the subject of relativity explained to him in a few unsuccinct phrases: "And from this Mr.Einstein makes a living?"

On forecasts:-
"Concerning these predictions, we are about to ask:
1. Are they pretty good?  
2. Are they slightly good?
3. Are they any damn good at all?
4. How do they compare with tomorrow's weather prediction you read in the paper?
5. How do they compare with the tipster horse race services?"

Quoting Major Lawrence Lee Bazley (L.L.B.) Angas on Charting:-
"All of these theories are true part of the time; none of the all the time.  They are, therefore, dangerous, though sometimes useful."

On margin trading:-
"Like all of life's rich emotional experiences, the full flavor of losing important money cannot be conveyed through literature.  Art cannot convey to an inexperienced girl what it is truly like to be a wife and mother.  There are certain things that cannot be adequately explained to a virgin either by words or pictures." (Mind you, this was written way before internet and the smut that gets offered through it)  

Further about the customer who is in for the ride on margin:-
"I have heard an old-line broker describe this common occurrence.  He explained, "They got on the Twentieth Century Limited at Grand Central Station.  They only intended to ride as far as 125th Street, where they would get off and visit Grandma.  But the first thing they knew they were making seventy miles an hour through Fort Wayne, Indiana.""

Quoting John W.Pope's letter to his investors:-
"His statement of condition as of Dec 31, 1930 was extremely simple.  All the money was in cash and call loans, which, strangely enough, was precisely where it should have been.  This statement also contained an incredible sentiment (I quote from memory), to this effect:
"It is the belief of the management of this corporation that a diversified list of carefully selected securities, held over a period of time, will not increase in value." "

 Here's an aptitude test from the book:-
"1. Do you perceive quite clearly what is the objection to playing a roulette wheel that has two zeros on it? (If not, don't bother to be a financier; be a roulette player.)
2. If a man has tossed a coin "heads" four times in succession, which do you think he is more likely to toss the fifth time, heads or tails? (If you think he is more likely to toss either heads or tails, look into the interior-decorating game. You have that instinctive type of mentality which might do very well at that.)
3. When do you consider that it is a good purchase to draw one card to an insight straight? (Answer - when you are playing for soybeans.)
4. If you have answered #3 correctly, do you find that when you are actually playing poker for money, you can always resist making that draw? (If not, stay home with your money and start practicing being a miser.)
5. If a stock which is not paying any dividend is split two for one, how much good does that do the stockholder? (If you think it does him any real good, come down and join our sales department but steer clear of our trading department.)
6. What is the primary purpose of a business enterprise? This questions is specifically for young men considering entering the banking field, where they will have a constant parade of business propositions passing before them, and they will be required to plump for a few of them and say "no" to the others. The answer is elementary and obvious: the primary purpose of a business is to make money. Almost anyone knows this with the top part of his brain. But there are only a few valuable young men who also know this all up and down their spinal column. 
Most businessmen imagine that they are in business to make money, and that this is their chief reason for being in business, but more often than not they are gently kidding themselves. There are so many other things which are actually more attractive. Some of them are: to make a fine product or to render a remarkable service, to give employment to revolutionize an industry, to make oneself famous, or at least to supply oneself with material for conversation in the evening. I have observed businessmen whose chief pre-occupation was to try to prove conclusively to their competitors that they themselves were smart and that their competitors were damn fools - an effort which gives a certain amount of mental satisfaction but no money at all. I have even seen some whose chief interest lay in proving this point to their partners. 
So give yourself a real good mark if you know that a business should make money, but only if you really know it."