This lesson covers chapters 5-7 of Alma. Alma “began to deliver the word of God unto the people, first in the land of Zarahemla, and from thence throughout all the land.” (Alma 5:1).
When we look at the river bed, we see that these rapids near Keokuk, Iowa, are the first place where the shallows make passage of a large ship impossible. It makes sense that the Mulekites would have disembarked here and “dwelt there from that time forth.” At this point of the Mississippi River, you can cross on foot much of the year. It would make an excellent trading area. 
If this area–designated in the 1800s as the “half-breed trace”–was the location of the ancient city of Zarahemla, the location could explain why the people were wealthy and why they had problems with pride, etc. (Of course, every human society has problems of pride, envy, etc. However, Alma focuses particularly on this when he’s in the city of Zarahemla.)
The scriptures don’t say that he started in the city of Zarahemla, but we infer he did because verse 2 relates what he taught the people there. In Chapters 6-7, Alma crosses the river to teach in in Gideon. The text implies this city/land was at some distance from Zarahemla because Alma could not visit when he was serving at the judgment-seat. The people of Gideon had different issues from those living in the city of Zarahemla. Generally they were more faithful in Gideon, which I infer means they were not as divided over issues of wealth.
In 5:27, Alma asks the people if they have been sufficiently humble. Next he asks “are ye stripped of pride?” Then, in verse 29, “Behold, I say, is there one among you who is not stripped of envy?” Later, in verse 54-55, Alma focuses on the “wearing of costly apparel” and “supposing that yea are better one than another,” “turning your backs on the poor, and the needy, and in withholding your substance from them.”
These questions suggest the people in the city of Zarahemla considered themselves wealthy. A look at the Iowa location of Zarahemla might help explain why the people there would have been wealthy.
First, if (as I think) the Mulekites sailed up the Mississippi River, they would have had to stop at the Des Moines rapids, which are just south of the Nauvoo area.
When we look at the river bed, we see that these rapids near Keokuk, Iowa, are the first place where the shallows make passage of a large ship impossible. It makes sense that the Mulekites would have disembarked here and “dwelt there from that time forth.” At this point of the Mississippi River, you can cross on foot much of the year. It would make an excellent trading area. 
When Joseph Smith purchased the land for Nauvoo, he actually purchased far more land across the river in Iowa, as this map from the Joseph Smith papers shows.
If this area–designated in the 1800s as the “half-breed trace”–was the location of the ancient city of Zarahemla, the location could explain why the people were wealthy and why they had problems with pride, etc. (Of course, every human society has problems of pride, envy, etc. However, Alma focuses particularly on this when he’s in the city of Zarahemla.)People ask if there is archaeological evidence for a city in this area. There is archaeological evidence of settlements along the river, north and south of this site, that date to Book of Mormon times, but nothing that can be identified as the city of Zarahemla, per se.
The city of Zarahemla and its inhabitants were burned (3 Nephi 8:8). Later, the city was built again (4 Nephi 1:8) but the city is not mentioned afterward. It could have been destroyed again, of course. The river could have flooded the city, deposited sand over it, or any number of other possibilities. For now, I note that it’s a location that seems to fit the text nicely.
Another consideration is that D&C 125 hints at this site as the location of ancient Zarahemla.
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Another interesting aspect of Alma 5 is the mention of sheep, shepherds, and wolves. There must have been sheep in the city of Zarahemla. We’ve already stipulated that, because the Nephites “strictly” observed the Law of Moses, but Alma emphasizes the point is repeated here.
v. 37: ye that have professed to have known the ways of righteousness nevertheless have gone astray, as sheep having no shepherd,
v. 38: ye are not the sheep of the good shepherd.
v. 39: And now if ye are not the sheep of the good shepherd, of what fold are ye?
v. 59: For what shepherd is there among you having many sheep doth not watch over them, that the wolves enter not and devour his flock?
v. 60: if you will hearken unto his voice he will bring you into his fold, and ye are his sheep; and he commandeth you that ye suffer no ravenous wolf to enter among you, that ye may not be destroyed.
These metaphors would be ineffective if the people living in Zarahemla did not have sheep. In verse 59, Alma abandons the metaphorical use and speaks directly to actual shepherds.
Some species of sheep that are indigenous to North America have survived to the present day, including the Bighorn and Dall. Anciently, their populations were in the millions. Although confined mainly to the western US, Canada, and northern Mexico.
Wolves are indigenous to North America and were ubiquitous throughout North America before the Europeans arrived. They were part of Native American Indian legends and mythology. Their devastating impact on domesticated animals led to federal government programs to eradicate wolves from grazing areas. See this article.
Because Alma discussed wolves in this sense, I think it’s possible that whatever domesticated sheep the Nephites had–whether related to the other indigenous North American species or species Lehi brought with him–were killed off after the destruction of the Nephite society. The situation could be similar to that of horses, where recent research has shown the traditional explanation for horses–that the Spanish brought them all–is not consistent with the actual records. See excellent article on horses: https://byustudies.byu.edu/system/files/pdfs/54_3JohnsonHard.pdf.
Source: 2016 Gospel Doctrine Resource