Smolin, interestingly is still into strings as well the LQG he pioneered, he eventually hopes to merge the best of both approaches into one approach. I agree totally with this baby universe idea, here is Tony Smith's take on it:
The Inflationary Universe is initially a region of R4 bounded by a Planck-size 3-sphere S3.
Since S3=SU(2), the Inflationary Universe has a boundary whose global Lie group structure is isomorphic to the SU(2) of the Higgs mechanism, so that the Inflationary Universe looks like an Expanding Instanton:
The New Universe can be regarded as being created in a Quantum Fluctuation Black Hole as described in hep-th/0103019 by Damien A. Easson and Robert H. Brandenberger, who study "... consequences of cosmological scenarios in which our universe is born from a black hole resting in a parent universe ...
[They] have provided a solution to the horizon problem by examining geodesics of matter falling into a black hole and showing that it is possible to bring this matter into causal contact before it emerges in the new universe. ...
The size of the daughter universe was calculated from both the Schwarzschild and the de Sitter perspectives. The Schwarzschild calculation predicts the universe to be infinite. The integral representing the length approaches infinity linearly. In order to recover the same result in the de Sitter frame, we must be matching the interior of the black hole to the spatially flat sections of de Sitter space. This is the only way to make the length approach infinity linearly. Hence, it appears that our model singles out the observed, flat FRW universe via a topological argument. ...
this scenario does not suffer from the black hole information loss problem since pure states evolve to pure states and information is transferred from the parent universe to the black hole interior universe.
Finally, a relation between structure formation and Hawking radiation was suggested. ...".