Once the investment trust was the remarkable invention that brought the small and innocent investor the precious benefits of skilled investment advice and the promise of high earnings and rich capital gains. Now we have the mutual funds. So precious is the financial genius provided by these that companies are organized to supply it to the companies that actually invest the money. The profit from the sale of this genius and also the cost of selling it being considerable, it would be illogical to assume that the investor gets the counsel at low cost. When the next collapse comes, quite a few who have committed themselves to contractual plans for investment - to putting so much money in a mutual fund each month - may discover that much of their money has gone for the genius, and the other costs, and not much remains in the stocks.
John Kenneth Galbraith, The Great Crash 1929. Time Inc Book Division. 1955. p. xxii-xxiv
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Note: I got Galbraith's book when in college, many, many years ago. It has sat on my shelf since then. I always assumed it was boring. On the other hand, every single other book in the Time reading program of the early 60's was interesting when I finally got around to reading it (including Bend Sinister by Nabokov which got me hooked on him.) So, I read The Great Crash - 1929 last fall for obvious reasons. Galbraith's book is extremely well written and funny. I know. I know. Funny economics is an oxymoron. Go figure.
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