If our bird is the markets, then the trade war is the latest cause of stress and not everyone believes the Federal Reserve can prescribe an antidote this time.

A phrase often used by American market commentators over the years is "don't kill the goose that lays the golden eggs" and while no one has slaughtered global markets yet, feathers have been sharply plucked.

Jerome Powell, chairman of the U.S. Federal Reserve, speaks during a Senate Banking Committee hearing in Washington, D.C., U.S., on Tuesday. Feb. 26, 2019.

Hans Redeker, Global Head of FX Strategy at Morgan Stanley said the market was wrong to buy stocks last week after Federal Reserve Chair Jerome Powell hinted at a response to any fallout from trade. Redeker said investors need to watch the warning signs.

One red flag, waving for weeks, is the inverted yield curve. Redeker said many people are simply putting it down to the U.S. repatriating money but ignoring its knock-on effect. Redeker said people should question how U.S. banks might act in future if they suffer limited profitability thanks to low interest rates..

But surely if growth slows and inflation falters, the Fed just steps in to reduce the cost of money? Not so fast.

While the Fed may cut, it's not a slam dunk that the dollar will fall. The Morgan Stanley team raked over the history books and found in two cases the dollar went down on the back of a rate cut but in three other cases it went up.

Redeker, an FX specialist, warned the dollar which funds 80% of global trade, needs to fall because at current levels it is suppressing growth. The problem is so acute Redeker said, it would not be a surprise if the U.S. led a discussion on FX at the G20 at the end of June.

Perhaps it's why the ECB's Mario Draghi didn't "out dove" Powell last week, weakening the euro.