The Equity Risk Premium is the extra return stocks offer over a 10-year Treasury bond, measured here as the stock market's earnings yield (1 divided by CAPE) minus the 10-year Treasury yield.
When it's positive, stocks pay you more than bonds for taking on extra risk. When it's near zero or negative, bonds pay about as much or more, and stocks have tended to return less over the following 5 to 10 years. It's a guide to long-run expectations, not a signal to sell: readings have stayed negative for years before a downturn arrived.
This simple version ignores earnings growth, so it reads lower than versions that include it.