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The Alpha Strategy is, without a doubt, the best explanation of the Federal Reserve System and the perils of fractional-reserve banking ever put on paper. This accounts for the first 50 pages of the book; the next 70 serve as a great primer on free-market economics in general. Doug Casey (of LewRockwell.com) is quoted on the back of the book calling author John Pugsley maybe "the greatest living free-market writer" -- keep in mind, this is when Murray Rothbard was still alive! And based on the skill with which Pugsley explains supposedly "difficult" concepts, I'm inclined to agree with Casey's assessment. I only wonder why Pugsley didn't go on to write more books.

The second half of The Alpha Strategy might be the reason: like Ron Paul in Gold, Peace, and Prosperity and Gary North in How You Can Profit From the Coming Price Controls, Pugsley ended up being wrong with his dire economic predictions for the 1980s. This is understandable: no one could have possibly foreseen Paul Volcker's tight monetary policy. However, all of the same factors that led Pugsley, Paul, and North to project the implosion of the dollar and U.S. economy in 1980 are present once again, only this time, we have a much larger debt, much bigger entitlement deficits, currency competition in the form of the euro, industrial competition from China, overextended military, much greater debasement of our currency, and a president and Federal Reserve Chairman who absolutely WILL NOT do what Volcker did. Thus, The Alpha Strategy is even more timely reading today than when it was written. Pugsley's predictions were not "wrong," they were just about 30 years too early.

The second half of the book is a stylistic departure, as noted in the three-star review here. But the strategy for preserving wealth and beating inflation is ingenious, foolproof, and... so obvious I can't believe I didn't think of it myself. A quote at the opening of the Second Part says it best: "The best solution is the simplest solution, and the simplest solution is the easiest to overlook."

Essentially, Pugsley's alpha strategy calls for people to invest in future consumption now: stock up on soup and underwear while the price is lower than it will be later due to inflation. In doing so, you may get an immediate profit (savings) by buying in bulk; you will most certainly receive a tax-free gain on the inflationary difference between what you pay now and what you would pay in the future; you'll save yourself time; and -- although this is just a fringe benefit -- you'll insulate yourself against job loss, depression, and/or chaos.

Even before stocking up on consumables, Pugsley says individuals should "invest in production" -- i.e., the education, tools, and materials needed to increase your income. I think it might be a little late in the game for this, as we are closer to the edge today than we were in 1981. I'd put consumables first on the list. Regardless, once you invest your maximum in production and run out of room to store consumables, Pugsley says then and only then should you buy items for later exchange. Chief among them in Pugsley's view are industrial and precious metals. As for stocks and other paper investments, Pugsley says to avoid them... sort of ironic since he now offers a stock-picking service.

I've read most of the works by Rothbard, everything by Ron Paul, and many other books from authors associated with the Mises Institute. I'd say, without a doubt, that the first 120 pages of The Alpha Strategy are the best introduction to free-market economics I've ever read. The second half of the book is the soundest investment strategy I've ever encountered, with a few differences of opinion (which Pugsley says are natural). Finally, the last chapter of the book offers a political strategy of sorts -- or more accurately, an anti-political strategy: Instead of writing to your congressman (who doesn't care) to oppose a subsidy bill, write to the beneficiaries of the subsidy and threaten to boycott. Contact union members when opposing a new labor law; complain to your local banker about Fed policy; and inform your friends, family, and neighbors about "the sting," as Pugsley calls it. We can't win a free society by "throwing out the bad guys" -- Pugsley likens this to throwing out your neighbor's goats when he steals your cabbage to feed them... your neighbor will just get new goats! Similarly, the ruling class will just get new politicians -- it's happened before.

I have tried to plug this book as much as I can on online forums and in daily life. It is no longer in print, though I was able to buy a used copy through Amazon very inexpensively. Alternatively, it is available for free online in PDF format. Read it and live it!

As relevant today as when Pugsley wrote it, the Alpha Strategy is the first book young people should read when they become income producers and property owners. The three categories of investments (knowledge, tools, and commodities) will prepare you for life to be a wiser spender, investor, and producer.

Very good read. Great insight on what is really going on. Thank you

This book is worth buying just for the first half, which explains how government regulations affect everyone and helps the reader to understand the actual cost, rather than the perceived (lower) cost. With that said, the author goes a little overboard in talking as if all government regulations are a bad thing. A logical person can tell you that's not true. Obviously we need a police force, we need roads that are functional and in good repair, etc. This book shows the extreme negative point of view regarding government spending. While it does provide some insight, please keep your head on straight as you are reading.

The second half which explains how to preserve your wealth is less beneficial. While it is true that buying products in advance of when you will use them can save money, some of the examples are terrible. Here is an example of how saving money by buying in advance can work and benefit you:

You use 1 roll of paper towels per week. Paper towels cost $1.25 per roll. Therefore, your paper towel expense is $1.25 per week. You buy paper towels each week, as you need them.

Now the book is telling you to stock up so when you realize you can purchase a pack of 12 rolls at $12.00 (and you actually have $12.00 to spend on them, as opposed to spending on debt or something else) you buy the dozen knowing you are saving $0.25 per roll/week. That doesn't seem like much money as it's just a quarter, but multiplying this over a lot of products, the savings does add up.

Now note: this only works during inflation (rising prices). If we were experiencing deflation (lowering prices) this wouldn't be good. The person in the example would be locked in at $1.00 per week spent on paper towels, for the next 12 weeks, and if the price deflated to $0.85 per roll, they would actually be losing money. So you will only want to use this tactic when you believe the price will RISE.

Another important thing to realize when reading is there are some things not worth purchasing in advance. The author advocates purchasing a car in advance and putting it up on blocks until you want to drive it, supposing you have enough money to do this. Now this might have actually worked in the 1980s when the book was written, but it is absolutely a bad idea today. The hoses and tires and other parts of the car will just rot if you store it on blocks for a few years. The amount of money saved would be lost as the buyer would have spent money getting the car road ready again.

Overall I feel the book is worth a read if you are already interested in this process, but apply logical though before taking action. Remember the book was written years ago, and see how things might apply in today's world and your own life before following this advice.

The first half of this book should be read by every person in the country. He does a real nice job of explaining federal debt and how we place value on things.

The second half of the book seemed a little over the top to me though. It sounds good to stockpile loads and loads of goods as tangible wealth, but it really is out of reach of most people.

A must have for the serious prepper.

This is a great book with information that is useful regardless of the economy.

Timeless information for protecting yourself from inflation, and why it occurs. The author presents a solid strategy for an individual to make the best use of his investment assets.