RICO lawsuits are the nuclear option for financial scammers.

GATA reports that MF Global execs will be prosecuted under the Racketeer Influenced and Corrupt Organizations Act (RICO). RICO is meant to bring down organizations, not individuals.  RICO gives prosecuters special powers of investigation and it makes penalties far worse and more far reaching than normal laws would allow.  When bankers see their goodfellows going to jail over RICO convictions they either hunker down and curtail investment activity or begin to look for tall buildings and bridges to jump off of for past violations. 

In short, RICO lawsuits are just the next step in the massive deflationary environment that is playing out.  RICO was never considered while the bubbles were being blown.  Why?  Because it would curtail “growth” (AKA debt based bubbles).  All of the people at the top knew what was what the whole time but they didn't complain as long as they were personally benefitting.  Fraudulent growth gets people elected in a society and economy which is infected with a fraudulent money supply.  Honesty is not respected in this environment and in fact causes those who are honest to be labeled as "cranks", "wacky" and the like.  The fact that the people are finally warming up to Ron Paul is proof positive that we are, slowly but steadily, returning toward a more honest money supply (less debt) and more traditional ideas of what constitutes a leader.

Bottom line: DEFLATION still rules the day.  Forget the happy talk you might hear, the global economy is still swirling the bowl.  France and other major Euro-economies were recently downgraded again by S+P.  The result?  Complaints that telling the truth is making the problems worse and promises that more austerity will be coming.  It wasn’t long ago that the Euroscammers were talking about making their own credit agencies up from thin air so that they could ignore S+P, Moody's and Fitch credit rating agencies.  All public mention of that has now evaporated and S+P is clearly calling the shots again.  Without cheap credit all governments will eventually collapse so they have to do anything they can to convince the credit rating agencies that they are behaving like adults.  Of course, the only real way to do that is to stop needing any credit!  So it’s all a big show, an ongoing con game. 

The global debt Ponzi has lost critical mass and is imploding into itself just as educated people of the Austrian School of economics said it would.  When, not if.  Think.  Suspend disbelief.  Act.