It is just a tad exaggerated to claim the WORLD is insolvent when clearly this is not (yet) the case.

What happens when the dollar cannot be used as a reserve currency? How will all the intertwined obligations in dollar denominated liabilities be untangled?

I do not see a healthy economy in ANY nation, and I see trade rapidly decreasing between countries. If these aren't signs of a world bankruptcy, I don't know what is.

It's called a Global recession. If the world was bankrupt there simply would not be things like 700 Billion dollar injections, or 10 billion Euro injections ....

You are in serious denial.

Global "recession"? I don't think so and neither do economists like Roubini

The U.S. will experience its most severe recession since WWII, much worse and longer and deeper than even the 1974-75 and 1980-82 recessions. The recession will continue until at least the end of 2009 for a cumulative GDP drop of over 4%; the unemployment rate will likely reach 9%. The US consumer is shopped out saving less and debt burdened and now faltering: this will be the worst consumer recession in decades.
The prospect of a short and shallow 6-8 months V-shaped recession is out of the window; a U-shaped 18-24 months recession is now a certainty and the probability of a worse multi-year L-shaped recession (as in Japan in the 1990s) is still small but rising. Even if the economy were to exit a recession by the end of 2009 the recovery could be so weak because of the impairment of the financial system and of the credit mechanism (i.e. a growth rate of 1-1.5% for a while well below the potential of 2.5-2.75%) that it may feel like a recession even if the economy is technically out of the recession

The world economy will experience a severe recession: output will sharply contract in the Eurozone, UK and the rest of Europe, in Canada, Japan, and Australia/New Zealand; there is also a risk of a hard landing in emerging market economies. Expect global growth – at market prices – to be close to zero in Q3 and negative by Q4. Leaving aside the effects of the fiscal stimulus China could face a hard landing growth rate of 6% in 2009. The global recession will continue through most of 2009.

What astounds me is just how quickly, and utterly, the US has squandered what must have been the best hand ever dealt a nation in all of history. I was watching The World At War recently, some of the collateral stuff with Prof. Stephen Ambrose speaking, then in about 1975 or 1976. He remarked that, per capita, the US staked the least of any of the major combatants, and was the big winner of the war. Proportionate to its stake, he remarked, the big loser was probably Britain, for a variety of reasons he listed.

But the US came out on top of everything. It went from being a considerable leading nation up to 1940 to emerging as THE leading nation. The untapped potential it had were realized, it gained effective control over half of Europe and much of Asia, and for more than a decade, it was really the only major source of tertiary goods in most of the world. And all that was still largely the case when Ambrose was talking, 30 years ago.

Other countries started catching up, of course, and the US couldn't have retained that kind of solitude forever. But sometime in the Reagan years, I think, administrations just completely lost their sense of reality. Profligate military spending during peacetime, allowing — even chasing — non-military manufacturing out of the country, and going from a policy of internationalism and cooperation during a time when it was unrivaled to one of unilateralism at a time when allies and foes alike were much more powerful and verging on being peers, have all combined to unseat the US as a welcome leader in many spheres in much of the world. And this has all happened easily within the lifetime of people still alive. Some of it has the air of inevitability — things change — but a lot of it seems born of ignorance and arrogance.