rant
1. Keeping a portion of the loan on the banks books
No! That isn't forcing banks to do what made them go bust in the first place. In the first place banks lent out £100 expecting to get £150 back in 5 years. However, 5 years is a long time, and there's some risk associated with it, so they sell the loan for say £120. There, they made a profit nice and fast! Not as much as they would have made if all went well, but good enough.
The trouble with that model is it incentivizes banks to lend shed loads of money to people they know can't afford to pay it back, then sell the loan at a reasonable profit before it goes bad. As long as they can keep shifting debt for cash all is good. Ofc it can't last forever as we saw.
Making banks retain some of the long term risk makes it a less viable option and so they won't do it. it may look very similar (banks got caught with risk and went bust, banks are now to be made to keep risk so they'll go bust) but it's entirely different. Now the banks KNOW they will be retaining risk, whereas before they made the stupid assumption they would always be able to shift it in time. It's all about changing the bankers frame of mind and making them more careful rather than getting carried away like a gambler in Vegas.
2. Hedge funds
Yes, yes they did cause problems. Back before anyone in the Ox and Cart had heard of hedgefunds they did a very simple and valuable task. They mitigated risk. Anyone that wanted to stabilise their expenditure (for example fuel costs, grain costs etc) they hedged. It's kinda (but not very much) like having a fixed rate mortgage. You know what you'll be paying for a certain period of time, but the pay-off is you lose out if the prices drop short term.
Then hedge funds started thinking hey - we're soooo good at this betting malarky! We hardly ever get it wrong. Let's bet shed loads of money on...oops. Ok, we got that one wrong, but we can't possibly get it wrong twi...oh bugger.
The point of hedge funds is stability, not betting on the markets. If they don't focus on their core job then everyone else that relies on hedging to keep their staff in jobs suffers. And everyone hedges. So everyone pays when it goes to pieces.