Apparently all it took to jolt investors back to their senses and restore sanity to the market was a $7-per-barrel plunge in the price of oil (in two days!). Friday, the crowd was hallucinating about the prospects for runaway inflation. Today, the fever is gone; the patient, calm.

Tuesday’s sell-off really didn’t do a lot of damage outside of energy stocks. In fact, a number of health care and consumer staples stocks ticked up for the session, including GlaxoSmithKline (NYSE: GSK), Johnson & Johnson (NYSE: JNJ), Kimberly-Clark (NYSE: KMB), McDonald’s (NYSE: MCD), Nestle (OTC: NSRGY), Novartis (NYSE: NVS), Pepsico (NYSE: PEP), Procter & Gamble (NYSE: PG) and Sysco (NYSE: SYY).

A day that hands us so many winners can’t be all bad!

What’s happening, in terms of the big picture, is that investors are beginning to scale back their excessively rosy forecasts for Q2 (and perhaps Q3) economic growth.

That’s a welcome development, because it means inflation fears are likely to cool in the months ahead. Investors in defensive, high-paying dividend stocks will prosper in such an environment.

In particular, I recommend dividend investors keep an eye on Raytheon (NYSE: RTN). In late March, the defense contractor’s board voted a 15% dividend hike — a rousing vote of confidence in RTN’s earnings outlook for 2011-2012. Pounce on the stock if it dips any further. RTN currently yields 3.4%.

Additionally, I expect bond yields will backpedal somewhat from here, driving up bond prices. Here I like the DoubleLine Total Return Bond Fund (MF: DLTNX), currently yielding 7.9% based on year-to-date distributions.

For your more conservative money, I like the Vanguard Intermediate-Term Investment Grade Fund (MF: VFICX), which yields 3.6%.