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  • Profit margins are probably the most mean-reverting series in finance, and if profit margins do not mean-revert, then something has gone badly wrong with capitalism. If high profits do not attract competition, there is something wrong with the system and it is not functioning properly.

    "Warren Buffett And Jeremy Grantham Are Right About Profit Margins" by Baijnath Ramraika and Prashant Trivedi, www.advisorperspectives.com. November 11, 2014.