The stability of charged grains given a random initial velocity is determined by a perturbation approach for the gravito-electrodynamic forces encountered in the corotating plasma environment of Saturn. Saturn's magnetic field is assumed to be a dipole with a small northward offset. If the equatorial component of the grain's initial velocity is given a specific value V30, the general results of two previous theories (Northrop and Hill, 1982; Mendis et al., 1982) are reproduced, including the critical radius for z instability at 1.616 R3. However, for initial velocities other than V30 a large spectrum of new results occur. Here we discuss the implications of these results for the formation of the Saturnian ring system. In particular, we suggest that the marginal z stability radius at 1.5245 R3 for Kepler-launched particles is due to an erosion process with ejecta of the order of 0.05 --0.5 &mgr;m rather than that of plasma as previously suggested. The diffuseness of the Saturnian rings beyond the F ring is also explained in terms of instability, while a new critical radius for r instability is suggested for the optical depth feature at 1.72 R3. Finally, the F ring is analyzed in detail.