What happens to all the aircraft that will be retired by various airlines? Do the aircraft go to a grave yard in the dessert? Are they sold to other airlines? Just curious...

Both usually. But with the glut of idled planes and the tough economic situation for airlines worldwide, I can't imagine there will be too many buyers.

Older ones go to desert, and many will be scrapped eventually. Some newer ones are just parked there, and will be reactivated when economy recovers and/or oil prices come down.

Some do leave the country to fly with other carriers. For example, at least 15 of Continental's fairly new 737-500s have gone or are going to a few carriers in Russia.

Yes, most of them go to a scrapyard, but some go to airlines in less wealthier countries...Some foreign airlines use Boeing 727s and McDonell MD-10s still.

Not related to the most recent cutbacks, but previously, many of the older planes retired by the major carriers would go to freighters and charters. FedEx, for example, has a huge fleet of DC-10s, MD-11s, and upgraded MD-10s, most of them converted from passenger versions.

Or for example, my parents flew to Brazil recently on Omni International, on a DC-10 that was previously with Northwest. They are a pretty large charter companies that do a lot of military charter work, but also with cruise lines.

I've seen some get used on Mythbusters.

I can't imagine that anyone would want older gas guzzlers in this day and age.

Here's an insightful article which pretty much states what already has been posted here...

http://www.slate.com/id/2192941/