WASHINGTON - On Thursday the Financial Crisis Inquiry Commission (FCIC) delivered the results of its investigation into the causes of the financial and economic crisis of 2008.

The FCIC, a congressionally appointed panel, concluded that the crisis was avoidable and was the result of human action and inaction: "The captains of finance and the public stewards of our financial system ignored warnings and failed to question, understand and manage evolving risks within a system essential to the well-being of the American public. Theirs was a big miss, not a stumble."

• The panel also concluded that the crisis was a result of:
• Widespread failures in financial regulation and supervision proved devastating to the stability of the nation??s financial markets.
• Dramatic failures of corporate governance and risk management at many systemically important financial institutions were a key cause of this crisis.
• A combination of excessive borrowing, risky investments, and lack of transparency put the financial system on a collision course with crisis.
• The government was ill prepared for the crisis, and its inconsistent response added to the uncertainty and panic in the financial markets.
• There was a systemic breakdown in accountability and ethics.

"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.

The Commission??s report also offers conclusions about specific components of the financial system that contributed significantly to the financial meltdown. Here the Commission concluded that:

• Collapsing mortgage-lending standards and the mortgage securitization pipeline lit and spread the flame of contagion and crisis
• Over-the-counter derivatives contributed significantly to this crisis
• The failures of credit rating agencies were essential cogs in the wheel of financial destruction.

The Commission also examined the role of government-sponsored enterprises (GSEs), with Fannie Mae serving as the case study. It found that the GSEs contributed to the crisis but were not a primary cause. They had a deeply flawed business model and suffered from many of the same failures of corporate governance and risk management seen in other financial firms but ultimately followed rather than led Wall Street and other lenders in purchasing subprime and other risky mortgages.

The Commission??s conclusions were drawn from the review of millions of pages of documents, interviews with more than 700 witnesses, and 19 days of public hearings in New York, Washington, D.C., and communities across the country that were hit hard by the crisis. The reports and accompanying dissents are available to the public on the Commission??s website.

"The greatest tragedy would be to accept the refrain that no one could have seen this coming and thus nothing could have been done," the panelists concluded. "If we accept this notion, it will happen again."