You might want to jump ahead and take a quick look at chapter 7. That's where the Virtual Machine is introduced.
The Virtual Machine has memory segments named local, argument, this, and that. When a VM language program (which is generated by the Jack compiler) is translated into Hack assembly language, the LCL, ARG, THIS, and THAT memory locations will be used by the ASM code that implements the local, argument, this, and that virtual memory segments.
I you are curious, nand2tetris/projects/06/pong/Pong.asm is a Jack program that has been translated to Hack assembly language.