Valuetainment
"Americans Are Being RIPPED OFF" - Trump’s 10% Cap PUTS Credit Cards ON NOTICE
16 Jan 2026
Chapter 1: What is Donald Trump's proposal for credit card interest rates?
Trump floats one year, 10% credit card interest rate cap. What that could mean for your money. Rob, I think you've got a clip on this one if you want to pull it up. I'll read the story, and then I'll come to you. Here we go. Effective January 20th. Is this when he's saying that, by the way, or is that he wrote it on Truth Social?
This is when he talks about the credit card company.
Okay. Go ahead. Play the clip. Can you go back a little bit, Rob? We missed it.
Well, then they're in violation of the law. Very severe things. No, I want a cap on credit card interest rates because, you know, some of them are 28, almost 30%. And then the people don't know they're paying 30%. People out there, you know, they're working. They have no idea that they're paying 30%. No way. We're putting a one-year cap at 10%, and that's it. They know it.
They've really abused the public. The credit card companies have totally abused it. I'm not going to let it happen.
All right, so Abusa, let me read this to you. Effective January 20th, 2026. I, President Trump, this is on Truth Social, I'm calling for a one-year cap on credit card rates at 10%. A credit card rate cap is enormously popular with Americans, said Matt Schultz. Chief credit card analyst at LendingTree.
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Chapter 2: How could a 10% cap on credit card rates impact consumers?
That's why we've seen big names on both sides of the aisle. Proposed credit card rate caps in recent years, including President Trump, who also floated the idea on the campaign trail 2024. Currently, about 175 million people in the U.S. credit card, according to the Federal Reserve Bank of New York. While some pay off the balance each month, roughly 60% of credit card users have revolving debt.
The New York Fed said that means they pay interest changes, charges, on the balances they carry from month to month. About 61% of credit card holders with credit card balance have been in debt for at least one year, up from 53% in late 2024, according to Bankrate survey. The average credit card interest rate in the U.S. fell to 23.79% in January, marketing the lowest level since March of 2023.
Mark, I'll come to you first. Thoughts on this story?
Yeah, I think when I hear this, I just think about the late stage fiat system that we're in. It's systemic to that. It's the same reason why Trump and Powell are openly fighting right now. We have inflation that's raging. People can't afford to live. And at the end, what the leaders always try to do is try to appease the people by price fixing. It always comes down to that.
We can't stop prices going up because we can't stop printing money. So how about we'll just cap prices? And so whether that's rent controls, Elizabeth Warren wants to cap the price of turkeys for Thanksgiving or it's credit card rates. The problem with price controls is we have a thousand cases of it not working. And just from a philosophical level, you can understand why.
So for example, credit cards, banks is a very competitive industry. Credit cards are very competitive and they're trying to get as many customers as they can. And they're constantly trying to
undercut each other in order to get more customers who cares what credit card you have you think about the rate and so it's very very competitive and so they want to get as many customers they can without blowing themselves up and so they're already trying to get rates down as low as possible they understand that people can just change balances from one card to the next and so if they could lower rates they certainly would the problem is when you cap it at 10 first of all
He said it's illegal. So there are already caps, right?
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Chapter 3: What are the potential consequences of price controls on credit?
There are usury laws. So there are already caps. But he wants to lower it to 10%.
What is it right now, by the way, Mark? Do you know what it is right now?
I was a California finance lender, I should know. It was in the high 20s. It was in the high 20s. Yeah.
Rob, can you pull up what the numbers are right now, what the current cap is right now?
Mark, finish your thought, I just wanna- So what I was saying is that it's already competitive. Credit card companies are already competing to bring the rates as low as possible. And what happens is if you cut the rate to 10% or 8% or 18%, whatever that number is, everybody that wouldn't qualify for that rate is then left without credit.
And that will then drive people either to the BNPL or drive them to their back alley neighborhood loan shark. And so people need money, especially, like I said, with this fiat system as we have today. People are falling further behind. They're using credit to augment their lifestyle.
And, yeah, if you cut them off at 18% or 15% or 10% as Trump is floating out, it just cuts off a huge segment of the population that needs it.
It's interesting, Rob. Is it really saying there's no existing cap right now on credit cards? No existing cap. That's really what it says, so there's no cap right now on credit cards. Usury laws don't apply to credit cards is what it says. Is that what it's saying? Where do you see that?
Oh, state usury laws generally don't apply to credit cards because most major issuers locate themselves in states like Delaware, South Dakota, or Missouri that exempt credit card debt from straight caps, wow, okay. Tom, go for it, thoughts on this.
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Chapter 4: How do credit card companies currently set interest rates?
And so they were handicapping the fact that, you know, a lot of people are probably gonna go for cash advances because money was tight, but they were gonna have issues paying it back. So during the COVID crisis, credit card companies across the board went in and adjusted down caps on the lowest third of consumers. It happened. And guess what? What that means is we've seen the playbook.
We know how they respond to stress. So that wasn't the government telling them. That was all of us in the boardroom of Visa saying... hey, the lowest third is starting to take a lot of cash advances, guys. Should we lower? I mean, these people have a $25,000 limit. Should we lower it to 20? Just send out the notice, lower it right now. Yes, let's do it. Because they were... mitigating risk.
So we've seen that happen, point one. Point two is what you have right now is the credit card companies are competing with each other. The reason the rates are coming down a little bit is because the federal rate was cut a little teeny bit. So the rates are coming down because they're trying to compete with each other. This is why Capital One has spent
billions of dollars in the last five years on consumer advertising. What's in your wallet? They want it to be the Capital One card. So they're competing with each other very, very stridently. What's going to happen if you put the cap, it's just like COVID. They're going to lower the limits. And people are going to turn to BNPL or other things.
Now, this is well intended by the president during a time of affordability. But I think right now the credit card companies operate in states that are most favored to them.
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Chapter 5: What are the statistics on credit card debt in America?
Sure. but also they're competing with each other. If one of them could get more customers by going to 19.99%, you'd see one of them do it tomorrow morning and be shouting from the rooftops, hey, your alternative to Capital One is me. Get Tom's credit card, maximum 19%. They would be competing with each other.
There is a active market and it's working well, and I don't think it needs this control on top of them. Like, they haven't discovered this is lead-based paint.
I wonder whose idea this was. Like, I wonder where Scott Besson lies with this idea. I really wonder what Scott said with this. Brandon, go ahead, because I got a bunch of... I got one number I just pulled up right now that when I share it with you guys... You're going to be blown away when I share this number with you in a minute. But go ahead, Brandon.
Yeah, it's funny you say that because I was just thinking it's as if they're sitting in a room saying, all right, this cost of living thing is becoming a problem. Everybody's still talking about it. What's a bone that we could throw at the public and appease them a little bit and make them feel like we're doing something? And this is a good start to that. I think it's a good idea.
I mean, I think maybe student loans would be a better place to either cap or remove interest rates because they've already been paid back a lot of times in terms of – like, without the interest. Like, I think that just paying back the loan would be enough. But yeah, it's an example of lobbying, the reason that I don't think there's a limit on it. That's probably why.
Because it's like the same thing as loan sharking. It's just like legalized loan sharking in a lot of cases. I think it's good for inflation because more debt equals a higher cost of goods and services. So it would create probably a crash type situation. The Great Depression is the biggest example of deflation.
But that's the thing that's unfortunate is you have to weigh an economic downturn versus the cost of living. You can't really have both of them be ideal.
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Chapter 6: How do different political figures view the interest rate cap?
Yeah. So affordability, there's a story that came out that the president reached out to Elizabeth Warren Did you see that story this morning, Rob? I thought I saw it correctly. Can you type up Trump-Elizabeth Warren affordability? I may be wrong, but I thought I just saw it early this morning. Is that it? Yeah, there's stories today about the phone call.
Okay, so they had a conversation this morning. And keep in mind, this 10% idea, do you know whose idea this was? If I tell you right now who proposed this idea last February 2025, who do you think it was? Was it Warren? Nope, but a person like that. Who do you think it was?
Bernie?
Bernie? Bernie Sanders. Bernie proposed this idea last year. He put this on the table. I think, can you type in Bernie Sanders 10% credit card? There it is. Sanders-Hawley introduced bill cap and credit card interest rates at 10%. Now, both of those are heavyweights on each side. Hawley's a heavyweight. Sanders is a heavyweight.
for a socialist slash communist to agree with a capitalist conservative on the 10%, this is where the independent in the middle will look at this and say, well, if both of these guys are on it, I'm willing to entertain it. So libertarian and independent will say, maybe this is not a bad idea, but here's what you got to be thinking about. So if you lower it to 10%,
The banks are going to sit there and say, our profits got hit. This is what the gentleman was saying last night to us.
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Chapter 7: What historical examples illustrate the effects of price caps?
And then they lend less. If they lend less, the small business owner takes a hit. Because who will they always lend to? They're always going to lend to the guy that doesn't need money. How much do you need? $100 million, 50 years? Take it, take it, whatever you want, right? Because they know that guy's going to pay the money back. But this is the number where...
I do believe there's an argument there, and some people may say, well, Pat, if you really believe in free market capitalism, what's wrong with this? Here's a question for you. What is an average business's EBITDA? Restaurant's EBITDA is what? What's a restaurant's EBITDA, Tom?
10%.
Lucky if you're there, 5% to 10%.
5%.
They get their asses handed to them, restaurants, right? Okay. What is a healthy business's EBITDA? What do you think it is?
10% to 20%.
10% to 20% would say pretty healthy, right? Now, if you're running a software technology difference, so let's set those aside, the 30%, 40%, like I'm talking Salesforce. What do you think is the profit margin of what these credit card companies are making? What do you think it is? Don't pull it up yet because, Rob, I want to see what they're going to say before you.
Ask the question, what are profit margins at credit card companies such as Visa, MasterCard, and American Express? But don't press enter yet. What do you think the number is?
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Chapter 8: What alternatives are available to consumers if credit access is restricted?
30%. That's a lot.
Yeah. Okay. I'm going to go more in line with restaurants.
5% to 10%. Where are you going to be, Tom?
Well, they're charging interest rates on one hand at the rates we're seeing. But on the other hand, they're only making 2.5% on the actual transaction.
So I'm going to blend it and go four. You're about to be shell-shocked. Go ahead, Rob. Ask the question and show them what it is. Net profits for Visa is 47% to 52%. Shh. MasterCard is 45%, Amex is 14 to 20%. So to me, are you flipping kidding me? They're printing money. Like every single year, I remember I bought Visa stock like 10 years ago and all you had to do was keep it.
But are you getting a credit card with Visa or are you getting with Capital One?
are we looking at the wrong number because visa's making the money for processing transactions so their fee their net profit's very high american express is the card issuer and so see how much 14 to 20 percent so i think really we have to look at capital one not visa right you you're thinking you're thinking more but i you think they're targeting capital one i don't think they're targeting visa's making all the money from processing the transactions they don't have the cost overhead the risk they're not making the slim margins on the spread
So I think you'd have to go to the actual card issuer, like a Capital One.
That is giving the debt to the clients?
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