In an episode of the Archie radio show, Fred was discussing Archie's friend, "appropriately named Jughead", with Archie. The conversation regarded Jughead's stupidity. So my guess is Jughead means "idiot" or "moron" or something similar.

"Jughead" is indeed an antiquated synonym for "idiot," "moron," etc. I agree that the name was probably given to him before his character was fully fleshed out, but these days it's meant to be ironic: his character appears to be lethargic, two steps back from everyone else, but is actually the sharpest, most observant and street-smart of any of the core five.

Does it have anything to do with his hat?  What were those pin-hats called back in the day?

I know the term "JAR-head" is a military term.  Is JUG-head a reference to the type of hat he is wearing?

I've always thought that too.....

Hmm, I don't know why he's named that. It could be the irony that he's the smartest one of the group, or it could be something simple. I know my friends have nicknames for each other that could include insults like moron and stuff like that. It doesn't mean they're really a moron, it's just a fun meaningless nickname. (Maybe the creators thought of that then? I mean didn't Archie wanted to be called 'Chic' in the original comics. o_o) I really do wonder why he's named that though now..