Yesterday Bloomberg reported that Goldman Sachs profited $2.9 billion for its own account thanks to the  taxpayer bailout of American International Group Inc (AIG) according to a congressionally appointed panel.

The Financial Crisis Inquiry Commission, which released its report on the crisis says the money was for proprietary trades of Goldman. While I am sure this is not shocking news to anyone—more is to pity—as one of the numerous unanswered or unsatisfactorily answered questions from the financial crisis was why was AIG bailed out in the first place.

We pointed out at the time that it seemed to be a bailout of AIG’s counterparties who had already seen the generosity of the Federal Reserve,  Treasury and Congress.

 While the report could be dismissed by some as Monday morning quarterbacking the main conclusion is an important one: the crisis could have been avoided.

 “Despite the expressed view of many on Wall Street and in Washington that the crisis could not have been foreseen or avoided, there were warning signs. The greatest tragedy would be to accept the refrain that no one could have seen this coming and thus nothing could have been done. If we accept this notion, it will happen again” said Phil Angelides, Chairman of the Commission.