INDIANAPOLIS - Indiana Treasurer Richard Mourdock, the man responsible for the state’s investments, has pulled much of his personal money out of the stock market. “Ten days ago, I sold all my stock,” Mourdock told the Huffington Post earlier this month. “I spend two hours every morning looking at market indicators.”

He had a different version for the Indianapolis Star on Sunday, saying, “I kept my energy stocks, my oil stocks, but everything else I sold, because I kept looking at what was happening in Washington, D.C., and I saw what its potential was on the markets, and I’m too old to have the volatility that we see today and what I expect the longer term will be.” Mourdock, 59, said he is “sitting” on his cash rather than investing it elsewhere.

It was just another curious twist in Mourdock’s challenge to U.S. Sen. Dick Lugar. Mourdock ran into an array of campaign miscues in June that included an anemic second quarter fundraisng total of just $300,000, and now faces the specter of State Sen. Mike Delph entering the race.

As the Indiana pension funds Mourdock presides over lost 11.2 percent of value since June – or $1.2 billion, according to the Evansville Courier & Press – Mourdock unloaded his personal stock portfolio on Aug. 2, the day Congress passed and President Obama signed the debt ceiling deal into law.

On Aug. 5, Standard & Poor’s downgraded the U.S. credit rating from AAA to AA+. Hours after the debt ceiling vote, Mourdock called for the resignation of Treasury Secretary Timothy Geithner and suggested the Senate remove its consent of the secretary to serve. “The Senate confirmed Mr. Geithner in January of 2009,” said Mourdock. “They ought to now take a vote of no confidence and withdraw that confirmation.”

Lugar, however, voted against the Geithner nomination. When WISH-TV reminded Mourdock of that, he responded, “He did? Well, he gets a chance to lead now to vote to withdraw the confirmation of the entire Senate.”

The problem with that statement is the Constitution does not give Congress the ability to “withdraw a confirmation,” a surprising gaffe from a candidate who claims to be a student of the Constitution.

The Washington Post reported that the Securities and Exchange Commission is looking into whether certain market participants learned of the downgrade before its announcement.

David Willkie, political director for the Friends of Lugar campaign, said of Mourdock personally pulling out of the stock market, “While the Indiana pension funds are taking a bath, this is not a way to promote market stability.”

It’s not the first time that Mourdock has found controversy with Indiana pension investments. He invested in Chrysler stocks at a time when they were at junk bond status, then sought to kill the Chrysler/Fiat merger, maintaining that it hurt Indiana teacher and police pension funds. The U.S. Supreme Court refused to hear the case.

Critics like U.S. Rep. Joe Donnelly, the Democrat running for U.S. Senate, say that Mourdock’s position would have done even more damage to the pension funds and could have cost the state millions of dollars in lost Chrysler and supplier company jobs, and state revenue.

The potential Delph entry is the last news the Mourdock campaign needed. It has the potential of keeping the forces aligning against Lugar from consolidating their efforts behind Mourdock, who has lost congressional campaigns in 1988 and 1990, as well as a secretary of state showdown with Delph in 2002.

Delph, R-Carmel, said he is “deeply moved by the encouragement and attention” of a potential Senate bid. Republican sources tell me that Delph is in the process of lining up campaign assets for a potential Senate run. There had been speculation that Delph might try and succeed U.S. Rep. Dan Burton, who is facing challenges from former congressman David McIntosh, former district attorney Susan Brooks and Dr. John McGoff. McIntosh raised more than $100,000 at a fundraiser at Jim Kittle’s home last week and Burton appears to be digging in to defend his seat.

Delph issued a statement calling on 2012 candidates to put aside their campaigns this year and help 2011 municipal candidates. “We seem to be speeding past 2011 to 2012,” said Delph. “So Sen. Lugar, Richard Mourdock, John McGoff, David McIntosh, Susan Brooks, Dan Burton, Mike Pence, Jim Wallace, and whoever else may have an interest in 2012, stop campaigning for yourselves and start helping your teammates who stand for election in just about 90 days. That is my aim and afterward I will let all inquiring minds know my own 2012 intentions, assuming they have crystallized by then.”

A potential Delph entry is the kind of perfect storm development the Lugar forces hope for. It has the potential to further crimp Mourdock’s already poor fundraising ability, and split the challenger forces two ways. While the Indiana Tea Party movement has scheduled an endorsement caucus on Sept. 24 in Greenfield, it is unclear who gets to vote and how it will handle a Delph entry into the race following the Nov. 8 municipal election, which Delph appears to be suggesting.

The danger for the Lugar campaign is that a Delph entry into the race could mean a better-financed and operationally more credible opponent.