Hello and Welcome to LQ,
What is your starting point when executing the commands, e.g. in what directory are you in when you execute them?
I started last weekend too with LFS and had the same problem until I realized that I needed to execute the commands from the $LFS/sources directory.
So when you extract the binutils package you 'cd' into that directory. That's the first step 'assumed' by the book. Next when in that directory ($LFS/sources/binutils-2.19.1) you issue the command to create the temporary dir:
mkdir -v ../binutils-build
and you encounter yourself in that directory.
So the binutils-build directory is in the same level as the binutils-2.19.1 directory.
Do a 'pwd' to find out your present working directory.