Ben Graham in 1955: CAPE Useful When 10 There's No Downturn?

Ben Graham series continues. This article by Ben Graham appears to have been penned in 1955. The focus of the article is mostly on the overall stock market valuation. Graham discusses the historic prices of the Dow Jones and the rise of the index from 1953-1955. Graham raises an interesting question. He uses the 10 year average earnings for the ten years ending in 1954 (similar or same as CAPE) to value the market. However, he notes that during this time period there was no deep depression, which makes those ten years a bit of an anomaly as it was not a typical business cycle. Full article embedded below:

Ben Graham on The Stock Market Situation and Valuation in 1955 by