what will happen if the world gov’ts default? I am a beginner at the high level financial stuff.
Past events tell us that when the currency fails nobody wants it any more if there is a better alternative. If you look at the 3rd world, when their local currencies are driven into the ground sellers want something else - US dollars currently, or Euros, or anything else that still has value. If the foreign currency is not available then barter becomes popular: "you give me one chicken and I will give you two tin pots."
This scenario will be probably applicable in case of global financial troubles. If leading world currencies are no longer accepted by sellers (due, for example, to abuse they suffer by reckless printing of money) then sellers won't take your dollars in exchange for their perfectly good oil, ore, products and services.
If we live to see that, then barter is practically the only answer. There is not enough physical gold on the planet to service the global trade. Then if the USA wants to buy a batch of tin pots from China, the seller will want in return also something tangible, something that has a reasonably stable value - like aluminum pots, or raw copper. If the USA doesn't have that, or anything else, then there is no sale. China will keep the products, and the US consumer will have to make his own pot, or repair an old one.
Barter will be undeniably bad for all developed nations because those nations largely export intangible things - promises, financial services, intellectual property. These products will be greatly devalued because, literally, you can't eat them, and only things that can be measured, counted and used will be accepted for barter. Those subprime real estate mortgages are a good example of promises; they were valued at $100 one day and as $0.01 another day - that's why they are worthless as money. A ton of nickel ore, on the other hand, is still as valuable today as a year ago; perhaps today it costs even more because natural resources are finite.
To summarize, if the global financial crash happens then the USA, as well as every other country on the planet, will have to go back to basics and start to produce stuff that other people want. Products of agriculture probably would be on top of that list, considering the climate. Industry, on the other hand, is probably beyond saving - do we even have technologists still alive who know how to build factories? Recent university graduates probably haven't even seen a modern electronic manufacturing plant unless they visited Asia.
If they ALL default, doesn’t it kinda just wash itself?
If I owe Joe $1000 and Joe owes Frank $1000, and Frank owes me $1000, and nobody can pay, does it really matter?
Glenn Beck covered this quite nicely. The first thing that goes is the dollar, the next are industries i.e. jobs, the third is the housing market, as there is no money and people default. It’s a domino effect.