This system creates the illusion of intelligence. We know from fMRI that "free will" does not exist and that "thoughts" are the brain's mechanism for justifying past actions whilst modifying the logic to reduce errors in future - a variant on back-propagation. Real-time intelligence (thinking before acting) doesn't exist in humans or any other known creature, so you won't build it by mimicking humans.
So how do you account for effortful thought or planning? It is true to say that there is no thinking before reacting, but to claim that there is no thought before action is absurd - how do you explain extended endeavours such as writing a book over the course of a year? That must be one hell of a chain of unlikely events that caused that number of reactions, which were combined without thought to produce a coherent written narrative.
Your other claims that memories do not exist and are synthesised on demand are interesting - do you have any references?