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The capacity of ideal MIMO channels has a high-SNR slope that equals the minimum of the number of transmit and receive antennas. This letter analyzes if this result holds when there are distortions from physical transceiver impairments. We prove analytically that such physical MIMO channels have a finite upper capacity limit, for any channel distribution and SNR. The high-SNR slope thus collapses to zero. This appears discouraging, but we prove the encouraging result that the relative capacity gain of employing MIMO is at least as large as with ideal transceivers.