loop.php and custom template

If i set the blog page in the admin panal to the page i made called blog then i see it uses the loop.php file and works no problem, however if i make a copy of the code in loop.php and paste it to the blog.php file it doesnt work.

am i supposed to change it somewhere else for it to work? how do i make a custom page work for blogging?

im using the HTML5 Blank theme and the loop.php code is:

<?php if (have_posts()): while (have_posts()) : the_post(); ?>

	<!-- article -->
	<article id="post-<?php the_ID(); ?>" <?php post_class(); ?>>

		<!-- post thumbnail -->
		<?php if ( has_post_thumbnail()) : // Check if thumbnail exists ?>
			<a href="<?php the_permalink(); ?>" title="<?php the_title(); ?>">
				<?php the_post_thumbnail(array(120,120)); // Declare pixel size you need inside the array ?>
			</a>
		<?php endif; ?>
		<!-- /post thumbnail -->

		<!-- post title -->
		<h2>
			<a href="<?php the_permalink(); ?>" title="<?php the_title(); ?>"><?php the_title(); ?></a>
		</h2>
		<!-- /post title -->

		<!-- post details -->
		<span class="date"><?php the_time('F j, Y'); ?> <?php the_time('g:i a'); ?></span>
		<span class="author"><?php _e( 'Published by', 'html5blank' ); ?> <?php the_author_posts_link(); ?></span>
		<span class="comments"><?php comments_popup_link( __( 'Leave your thoughts', 'html5blank' ), __( '1 Comment', 'html5blank' ), __( '% Comments', 'html5blank' )); ?></span>
		<!-- /post details -->

		<?php html5wp_excerpt('html5wp_index'); // Build your custom callback length in functions.php ?>

		<?php edit_post_link(); ?>

	</article>
	<!-- /article -->

<?php endwhile; ?>

<?php else: ?>

	<!-- article -->
	<article>
		<h2><?php _e( 'Sorry, nothing to display.', 'html5blank' ); ?></h2>
	</article>
	<!-- /article -->

<?php endif; ?>