In a small bowl, dissolve the active dry yeast in warm water and let it sit for about 5-10 minutes, or until it becomes frothy.
In a large mixing bowl, combine the all-purpose flour, granulated sugar, and salt.
Add the yeast mixture to the flour mixture and mix well until a soft dough forms. If the dough is too dry, add a little more warm water, a tablespoon at a time.
Knead the dough on a lightly floured surface for about 5-7 minutes, or until it becomes smooth and elastic.
Place the dough in a lightly oiled bowl, cover it with a damp cloth, and let it rise in a warm place for about 1-2 hours, or until it doubles in size.
Punch down the dough and divide it into small balls (about the size of a golf ball).
Flatten each ball slightly and use your thumb to make a hole in the center, creating a doughnut shape.
Heat vegetable oil in a deep frying pan or pot over medium heat.
Carefully place the doughnuts into the hot oil, a few at a time, and fry until they are golden brown and puffed up, about 2-3 minutes per side.
Use a slotted spoon to remove the bambalouni from the oil and place them on paper towels to drain excess oil.
Dust the bambalouni with powdered sugar if desired.
Enjoy your meal!