Treasury Reaffirms August 2nd Default Date

The Obama administration on Friday reaffirmed August 2nd as the date when the nation's debt will max out, yet no agreement on how to avoid that default is in sight.

"The Treasury Department continues to project that the United States will exhaust its borrowing authority under the debt limit on August 2, 2011," Mary Miller, Assistant Secretary for Financial Markets at the U.S. Department of the Treasury, said in a statement.

Adding urgency, she said, "Secretary Geithner urges Congress to avoid the catastrophic economic and market consequences of a default crisis by raising the statutory debt limit in a timely manner."

Both Democratic and Republican negotiators agree that defaulting would cause dangerous ripple effects but negotiations have been put on hold and each side is hardening its position.

A Democratic official with knowledge of the debt talks says in order to remain on track to avoid default by August 2nd, a deal needs to be reached between July 15th and July 22nd.

However, the White House is careful to avoid calling the 22nd a drop-dead date for completion.

"I'd wave you off the notion that we've set any hard deadlines at this point," a senior administration official tells Fox News.

The administration has been down this deadline road before. The Treasury Department has laid out default markers which have come and gone with no consequences, but the administration has said it was accounting maneuvers which allowed that to happen.

Still, there is only so much time left, says the Democratic official. "If the markets start to react then we've waited a day too long."