In fact, one of the reasons why I dont think Chris Cook's model will work is that it has been proven by reality not to work: Mortgage-Backed Securities, repackaged and resliced and resold to other investors, with the initial dealers not taking any of the risk is exactly what his model is about.  And the result is what you would expect when the people that cook up the paper and those that hold it are so separated.

You need banks to assess risk - and to put their good name on the risk by holding it themselves.

Eh? I'm absolutely gob-smacked. Where on earth do you get that from?

I see the future role of banks as service providers within partnership frameworks, and one of the key elements of this model is that at least part of their remuneration will be related to the outcome of the work that they do. This does not involve putting capital at risk (other than reputation) but it does involve putting future income at risk.

There are two types of work I see banks in.

(a) "Peer to peer" credit - managing the bilateral creation of "trade" credit necessary for the creation of productive assets, including the bringing together of risk-friendly investors with risky development;  

b) "Peer to Peer investment" - post-development, refinancing through "Peer to Peer" investment by risk averse investors in the "unitised" production streams - essentially monetisation through the creation of redeemable units.

When have I ever said I don't see banks as having any stake in the outcome of what I have always described as a partnership-based model?

I have had excellent feedback in respect of this recent lecture in Ireland

Unitisation: solving the Credit crunch - Quicktime file

Please take the time to view it, or if not, then take ten minutes to look the slides.

here

Then explain to me firstly, what is impracticable about what I am suggesting, and secondly, in what respect this service provider model bears any resemblance whatever to the structural faults of the MBS "originate and distribute" transactional model to which you refer.

How many times have I said that I think that intermediaries and the related "for profit" transactions have no future in a directly connected "peer to peer" economy?

And when have you ever addressed that point, whether to agree or disagree with it?

"The future is already here -- it's just not very evenly distributed" William Gibson