A man walks past an electronic board showing Hong Kong share index outside a local bank in Hong Kong, Wednesday, April 4, 2018. Asian stock markets were mixed in early trading Wednesday as investors digested the latest volley of tariff measures and threats between the U.S. and China. (AP Photo/Kin Cheung)

A man walks past an electronic board showing Hong Kong share index outside a local bank in Hong Kong, Wednesday, April 4, 2018. Asian stock markets were mixed in early trading Wednesday as investors digested the latest volley of tariff measures and threats between the U.S. and China. (AP Photo/Kin Cheung)

WASHINGTON (AP) — President Donald Trump persists in using a phony number to justify his market-shaking trade actions against China.

TRUMP tweets Wednesday:

— “We are not in a trade war with China, that war was lost many years ago by the foolish, or incompetent, people who represented the U.S. Now we have a Trade Deficit of $500 Billion a year, with Intellectual Property Theft of another $300 Billion. We cannot let this continue!”

— “When you’re already $500 Billion DOWN, you can’t lose!”

THE FACTS: He overstates the trade deficit by $163 billion.

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He does this by counting Americans’ purchases of goods from China as a loss for the U.S., while ignoring what China buys from the U.S. He also ignores another big part of the equation — trade in services.

Last year, Americans bought about $505.6 billion in goods from China while China bought about $130.4 billion in goods from the U.S. So the actual trade deficit in goods was just over $375 billion.

Factor in trade in services and the actual U.S trade deficit with China was $337 billion.

As for intellectual property theft, it’s not clear where Trump gets his figure of $300 billion, though it may be a plausible estimate.

Illicit activities such as counterfeit goods, pirated software, theft of trade secrets and copyright and trademark infringement cannot be precisely measured. An independent bipartisan U.S. commission estimated that U.S. interests lost $300 billion from global intellectual property theft in 2013, with China the main culprit. The commission, in a 2017 update, gave a wide-ranging estimate, $225 billion to $600 billion, with thefts led by “thousands of Chinese actors.”

The Trump administration this week announced planned tariffs on $50 billion in Chinese imports; Beijing responded with plans to penalize imports from the U.S. by the same amount. This followed an opening salvo of U.S. penalties on steel and aluminum imports from overseas, including China, and Beijing’s retaliatory taxes on $3 billion of U.S. products.

The escalating dispute between the world’s two largest economies has roiled global markets. The S&P 500 has fallen more than 4 percent since March 1.

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2017 U.S. trade statistics: https://www.census.gov/foreign-trade/Press-Release/current_press_release/exh20.pdf

Intellectual property theft report: http://www.ipcommission.org/report/IP_Commission_Report_Update_2017.pdf

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Associated Press writers Christopher Rugaber and Josh Boak contributed to this report.

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