S&P's index guru David Blitzer on passive investing, market valuation and Trump-Reagan comparisons

David Blitzer, chairman of the Index Committee at S&P Dow Jones Indices, spoke at length with CNBC's Mike Santoli about passive investing, how to value the market and what may be ahead under President-elect Donald Trump.

"One comment that's come up a few times and maybe it's looking at the individual as much as anything else, but there seems to be an interest to compare Reagan and Trump together," said Blitzer in reference to the similarities between both politicians.

Despite those comparisons, the path ahead for the incumbent president may not be as rosy, according to Blitzer:

"Reagan's economic policy — very different than what we have now in a sense — was very tight monetary policy. Paul Volcker was in the Fed. They just crashed down on inflation. And it was still very tight. When Reagan came into office, interest rates were probably 15 percent, 16 percent, which shocks people today. On the other hand, you know, Reagan said he was going to balance the budget. But he didn't. And I don't think Mr. Trump has said he is going to balance the budget. But it'd be very difficult for anybody to balance the budget today. So if he looks like Reagan, we're going to flip everything around," he said.

In this exclusive conversation for PRO subscribers, Blitzer, who's been ranked by Smart Money magazine as one of the 30 most influential people in the world of investing, also discusses:

  • How new index members are selected.
  • Trends in the housing market.
  • Inflation, valuations and his outlook for stocks.

PRO subscribers can also read the entire transcript of the exclusive interview below.