Where Are the Customers’ Yachts?

A professional Wall Street trader who lost much of his wealth in the 1929 crash, Fred Schwed Jr. later turned to writing. His humorous account of the securities trade takes its title from a story in which a visitor to New York, admiring the yachts owned by bankers and brokers, asked naively where the customers kept theirs. None of the clients could afford one, though they had faithfully followed their advisers. Schwed exposes the folly and hypocrisy of a business in which brokers prosper while customers go broke, and mixes the satire with contrarian advice on investing. Simon & Schuster published it in 1940, and figures such as Jack Bogle and Michael Lewis often cite it.

In his 2006 shareholder letter, Warren Buffett called it the funniest book ever written about investing and said it carries important lessons with a light touch.