That sample code is quite a collection of deprecated syntax, and somehow they missed it when they updated the book to Swift 2.0!
(from The Swift Programming Language > Language Guide > Strings and Characters > Accessing and Modifying a String)
The indices() function is gone too, and the print() function has changed to take over from println() and doesn't work so well in playgrounds when used incrementally, so the sample code would now probably be something like this:
let greeting = "Guten Tag"
var str = ""
for index in greeting.characters.indices {
str = str + "\(greeting.characters[index]) "
}
print(str)
// prints "G u t e n T a g "