To "save us from reality" people are hoping for some great action or hints embedded in Bernanke's Jackson Hole speech tomorrow. While pathetic that this is what it has come down to (earnings anyone? company fundamentals? growth prospects? an economy left to its own devices?) almost all the trading nowadays is based on hopes for government intervention or Fed intervention and has been since late 2007. It was not always like this but if you have entered the stock market the past 2-3 years, you'd think it was normal for us to be hanging on these actions as if the world depended on it.
Further, what can Ben say tomorrow? He is between a rock and a hard place. What does "the market" want?
A) If he says everything is fine, and it's business as usual with no need for further helicopter drops - the market will whine and cry about not getting a handout of free money.
B) If he says he is ready with helicopter bags of even more money, and he is willing and glad to hand it to everyone who asks - the market will whine and cry about what bad news does the Fed know that we don't know to make them so desperate? Why is Ben so panicked he is handing us money again?
Damned if he does, damned if he doesn't. Good luck with the speech Zeus.