INFLATION is the new property crash.

Bundoran's trade union war drums were testing out a new beat . . . if inflation continues to go up, you can forget the latest pay deal between the unions, government and big employers . . . 'Towards 2016'.

(Or in the trade, 'T16' . . . which sounds like a Terminator sequel too many or the nickname of the Michael O'Leary Memorial Terminal at Dublin Airport; but I digress. ) Increases in interest rates . . .eight of them since December 2005, doubling the rate from 2% to 4% and more on the way . . .are supposed to make inflation fall.

In Ireland, the resulting increased mortgage payments makes inflation go up.

This is either perverse, an accurate reflection of our lives, or both.

Just before the Central Statistics Office released the latest number, there was a suspicious coincidence of comment. Three independent sources . . . at Davy Stockbrokers, Bank of Ireland and employer group IBEC . . . all hinted that actually, inflation isn't as high as you think. It's just that Ireland calculates it the wrong way. If we were to follow what most other eurozone countries do and exclude mortgages, inflation wouldn't be around 5%. It would actually be around 2.8%. The unspoken implication being, no need to panic. And no need to renegotiate your pay deal.

An economist friend told me a joke once: if you torture the data long enough, it will confess to anything.

Personally I don't think he's very funny, but then I prefer it when people laugh at my jokes so I force out a guffaw.

I'm doing a Guantanamo on his data . . . I'm laughing because I think that's what he wants to hear.

When most of us hear something we don't like, we might get angry. We text the radio station or yell at the TV or write an angry comment on the website.

Eventually, we change the channel.

Economists aren't that different from you or me.

Sort of. But this channel can't easily be changed. So they've brought out the waterboard and electrodes and are interrogating the poor Consumer Price Index . . . the basket of 12 categories of stuff meant to reflect the cost of living for an average Irish household, calculated by the Central Statistics Office in Cork.

Turns out the argument about the inflation formula isn't new. The most persuasive case for changing it is made by UCD economist Colm McCarthy, who writes in a draft paper that because of our unique statistical method . . . including not just mortgage interest but also a 20-year history of house price rises . . .Irish inflation would continue to rise for the next 20 years even if all prices for homes, goods and services were frozen at today's levels and interest rates stuck just where they are. Which just seems cracked.

And anyway, argues IBEC chief economist David Croughan, mortgage payments are technically an investment, not consumer spending. If we didn't have rates of home ownership so much higher than other countries . . . around 75% . . . this wouldn't be such a problem.

But we do like owning our own homes, which is good.

We also tend to have mortgages without a fixed interest rate, which is good . . .if rates go down and not up.

Whether that's a sane system is another day's work, but the point here is that Ireland's inflation number is different in part because Ireland is different.

It's hard to remember anybody squealing about this being perverse when declining interest rates . . . the ECB dropped them from 4.75% in 2000 to 2% in 2003, where they stayed for more than two years . . . pushed the Irish inflation number below 2%. It also didn't prevent the public sector from securing a binge of pay rises around the same time.

A temporarily higher inflation number now isn't itself a good reason either to change the way we do the numbers or to let the unions get away with economic mischief. The real number to watch is our economic growth, which now looks stronger than it did a few weeks ago and may be as high as 6%. On average, things are fine.

Then again, ask an economist with his head in an oven and feet in ice how he's doing and he'll tell you the same thing.

Come on, that was funny.