### BTS Stocks Tumble as Trump’s Credit Card Rate Cap Proposal Shakes Financial Sector

Capital One’s shares dropped by 6% following a proposal by former President Donald Trump to cap credit card interest rates at 18%. This announcement has sent shockwaves through the financial sector, affecting not only Capital One but also other major banks.

#### Detailed Body

The proposal by Donald Trump to cap credit card interest rates at 18% has been met with significant backlash from the financial community. This move is seen as a direct attack on the profitability of credit card issuers, who rely on high-interest rates to generate revenue.

– **Market Reaction:** Capital One’s stock price fell by 6% immediately following the announcement. Other major banks, including JPMorgan Chase and Bank of America, also experienced significant drops in their stock prices.
– **Impact on Profitability:** Credit card issuers generate a substantial portion of their revenue from interest charges on outstanding balances. A cap on interest rates would significantly reduce this revenue stream.
– **Consumer Impact:** While consumers would benefit from lower interest rates, the proposal could lead to stricter credit requirements and fewer rewards programs, as banks seek to offset lost revenue.

#### Expert Analysis

Financial experts are divided on the potential impact of Trump’s proposal. Some argue that it could lead to a more equitable financial system, while others warn of unintended consequences.

– **Pros:**
– **Consumer Benefits:** Lower interest rates would make it easier for consumers to pay off their credit card debt, potentially reducing the overall burden of consumer debt.
– **Economic Stimulus:** Reduced debt payments could free up consumer spending, potentially stimulating economic growth.
– **Cons:**
– **Reduced Access to Credit:** Banks may become more cautious about issuing credit cards, particularly to subprime borrowers, as they seek to mitigate risk.
– **Fewer Rewards Programs:** With reduced revenue from interest charges, banks may cut back on rewards programs, which are a significant draw for many credit card users.

#### Conclusion

The proposal by Donald Trump to cap credit card interest rates at 18% has sparked a heated debate within the financial sector. While the potential benefits for consumers are clear, the long-term impact on the profitability of credit card issuers and the broader economy remains uncertain. As the situation develops, it will be crucial for policymakers to carefully consider the potential consequences of such a move.

In the meantime, investors in the financial sector should brace for continued volatility as the market reacts to this significant proposal. The coming months will be critical in determining the future of credit card interest rates and the broader financial landscape.